Quarterly Report (10-q)

 

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

 

FORM 10-Q

 

x Quarterly Report under Section 13 or 15(d) of the Securities Exchange Act of 1934

 

For the quarterly period ended September 30, 2015

 

¨ Transition report under Section 13 or 15(d) of the Exchange Act

 

For the transition period from ______________ to ______________

 

Commission File Number: 333-1416686

 

VERDE SCIENCE, INC.

(Exact name of Registrant as specified in its charter)

 

Nevada		20-8387017
(State or other jurisdiction of incorporation or organization)		(I.R.S.Employer Identification No.)
400 S. Zang Blvd. Suite 812 Dallas, Texas 75208, USA		Telephone: [phone]
(Address of principal executive offices)		(Registrant's telephone number, including area code)

 

Former Name, Address and Fiscal Year, If Changed Since Last Report

 

Check whether the issuer: (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

 

We had a total of 23,867,679 shares of common stock issued and outstanding at December 8, 2015.
 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a nonaccelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer," and "smaller reporting company" in Rule 12b2 of the Exchange Act.

 

Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	x
(Do not check if a smaller reporting company)

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

 

Transitional Small Business Disclosure Format: Yes ¨ No x

 

 

 

PART I - FINANCIAL INFORMATION

 

Item 1. Financial Statements

 

The interim financial statements included herein are unaudited but reflect, in management's opinion, all adjustments, consisting only of normal recurring adjustments that are necessary for a fair presentation of our financial position and the results of our operations for the interim periods presented. Because of the nature of our business, the results of operations for the quarterly period and the nine months ended September 30, 2015 are not necessarily indicative of the results that may be expected for the full fiscal year. 

 

2

 

VERDE SCIENCE, INC.

 

BALANCE SHEETS

 

		September 30, 2015 $				December 31, 2014 $
		(unaudited)
ASSETS
Cash		$	812			$	128
Prepaid			6,667				–
Total Assets			7,479				128
LIABILITIES AND STOCKHOLDERS' DEFICIT
Liabilities
Accounts payable and accrued liabilities		$	393,898			$	304,939
Due to related party – accounts payable, net			211,311				230,701
Due to related party – notes payable			29,156				32,213
Due to related party – convertible notes payable			785				226,785
Convertible notes payable, net of discount of $236,107 and $0			45,643				–
Derivative liabilities			372,472				–
Total Liabilities			1,053,265				794,638
Nature of Operations and Continuance of Business (Note 1)
STOCKHOLDERS' DEFICIT
Common stock, 100,000,000 shares authorized, $0.001 par value; 23,867,679 and 467,679 issued and outstanding as of September 30, 2015 and December 31, 2014, respectively			23,868				467
Additional paid-in capital			6,464,588				6,218,103
Accumulated comprehensive income			2,803				2,803
Accumulated Deficit			(7,537,045	)			(7,015,883	)
Total Stockholders' Deficit			(1,045,786	)			(794,510	)
Total Liabilities and Stockholders' Deficit		$	7,479			$	128

 

(The accompanying notes are an integral part of these financial statements)

 

3

 

VERDE SCIENCE, INC.

 

STATEMENTS OF OPERATIONS

(unaudited)

 

		Three Months Ended September 30,								Nine Months Ended September 30,
		2015				2014				2015				2014
REVENUE
Total Revenue		$	–			$	–			$	–			$	–
OPERATING EXPENSES
Accounting and Professional Fees			23,766				38,582				44,949				75,845
Consulting Fees			84,746				199,963				298,275				1,821,367
Office and Administration			11,269				13,904				27,692				30,030
Foreign exchange gain			(11,714	)			–				(56,886	)			–
Total Operating Expenses			108,067				253,449				314,030				1,927,242
NET LOSS FROM OPERATIONS			(108,067	)			(253,449	)			(314,030	)			(1,927,242	)
Other Income (Expense)
Net interest expense			(36,270	)			(118,308	)			(61,410	)			(135,837	)
Gain (Loss) on changes in fair value of derivative liability			37,732				–				(145,722	)			–
Total Other Income (Expense)			1,462				(118,308	)			(207,132	)			(135,837	)
NET LOSS FROM CONTINUING OPERATIONS			(106,605	)			(371,757	)			(521,162	)			(2,063,079	)
Discontinued Operations (Note 3)
Loss from discontinued operations			–				–				–				(465,000	)
Net Loss on Discontinued Operations			–				–				–				(465,000	)
Net Loss and Comprehensive Loss			(106,605	)			(371,757	)			(521,162	)			(2,528,079	)
Net Loss Per Share – Basic and Diluted			(0.00	)			(0.81	)			(0.03	)			(6.18	)
Weighted Average Shares Outstanding			23,867,638				457,294				19,666,905				409,183

 

(The accompanying notes are an integral part of these financial statements)

 

4

 

VERDE SCIENCE, INC.

 

STATEMENTS OF CASH FLOW

(unaudited)

 

		Nine Months Ended September 30,
		2015				2014
OPERATING ACTIVITIES
Net loss for the period		$	(521,162	)		$	(2,528,079	)
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization of debt discount			45,643				–
Changes in fair value of derivatives			145,722				–
Payment of services with shares			–				391,801
Option expense			–				1,301,538
Imputed interest – related party			3,885				17,425
Discount on note issued to related party			–				112,160
Changes in operating assets and liabilities:
Accounts payable – related party			(5,743	)			84,162
Accounts payable			78,965				125,735
Prepaid expenses			(6,667	)			–
Net Cash Used in Operating Activities			(259,357	)			(495,258	)
FINANCING ACTIVITIES
Capital stock issued			40,000				468,200
Proceeds from related party loans			19,853				28,756
Repayment of related party loans			(26,562	)			(1,357	)
Net proceeds from issuance of convertible debt			226,750				–
Net Cash Provided by Financing Activities			260,041				495,599
INCREASE IN CASH		$	684			$	341
Cash, Beginning of Period			128				203
Cash, End of Period		$	812			$	544
Supplemental Disclosures
Interest paid			–				–
Income taxes paid			–				–
Non-Cash Investing and Financing Activities
Cashless exercise of stock options			–				17,600
Conversion of debt			226,000				–
Discount on debt due to derivative			226,750				–
Discount of convertible note, related party			–				226,785

 

(The accompanying notes are an integral part of these financial statements)

 

5

 

VERDE SCIENCE, INC.

 

NOTES TO THE INTERIM FINANCIAL STATEMENTS
September 30, 2015
(Stated in US Dollars)
(Unaudited)

 

NOTE 1. NATURE OF OPERATIONS

 

DESCRIPTION OF BUSINESS – Verde Science, Inc. (hereinafter referred to as the "Company") was incorporated on January 31, 2007 by filing Articles of Incorporation with the Nevada Secretary of State. The Company was formed to engage in the exploration of resource properties. On January 31, 2012, the Company changed its name from Avro Energy, Inc. to Rango Energy, Inc. On April 2, 2014, the Company announced that it was changing its business and was entering into the pharmaceutical industry focusing on the use of derivatives of cannabis to develop specific drugs. On May 7, 2014, the Company changed its name from Rango Energy, Inc. to Verde Science, Inc.

 

GOING CONCERN The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company suffered reoccurring net losses from operations and has a net capital deficiency, which raises substantial doubt about its ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that may result should the Company be unable to continue as a going concern.

 

As shown in the accompanying financial statements, the Company has incurred an accumulated deficit of $7,537,045 as of September 30, 2015. The future of the Company is dependent upon its ability to obtain financing and upon future profitable operations from the development of acquisitions. Management has plans to seek additional capital through a private placement and public offering of its common stock. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts of and classification of liabilities that might be necessary in the event the Company cannot continue in existence.

 

NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

BASIS OF PRESENTATION These financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States, and are expressed in U.S. dollars. The Company's fiscal year end is December 31.

 

USE OF ESTIMATES The preparation of financial statements in accordance with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of net revenue and expenses in the reporting period. We regularly evaluate our estimates and assumptions related to the useful life and recoverability of long lived assets, stock based compensation and deferred income tax asset valuation allowances. We base our estimates and assumptions on current facts, historical experience and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by us may differ materially and adversely from our estimates. To the extent there are material differences between our estimates and the actual results, our future results of operations will be affected.

 

CASH AND CASH EQUIVALENTS The Company considers all highly liquid instruments with original maturities of three months or less when acquired, to be cash equivalents. We had no cash equivalents at September 30, 2015 or December 31, 2014, respectively.

 

INCOME TAXES Potential benefits of income tax losses are not recognized in the accounts until realization is more likely than not. The Company has adopted ASC 740, Income Taxes, as of its inception. Pursuant to ASC 740, the Company is required to compute tax asset benefits for net operating losses carried forward. The potential benefits of net operating losses have not been recognized in these financial statements because the Company cannot be assured it is more likely than not it will utilize the net operating losses carried forward in future years.

 

COMPREHENSIVE LOSS ASC 220, Comprehensive Income, establishes standards for the reporting and display of comprehensive loss and its components in the financial statements. As of September 30, 2015 and December 31, 2014, the Company has no items that represent comprehensive loss and, therefore, has not included a schedule of comprehensive loss in the financial statements.

 

6

  

STOCK BASED COMPENSATION ASC 718, Stock-based compensation, establishes standards for the reporting and display of stock based compensation in the financial statements.

 

LOSS PER COMMON SHARE The Company computes net loss per share in accordance with ASC 260, Earnings Per Share, which requires presentation of both basic and diluted earnings per share (EPS) on the face of the income statement. Basic EPS is computed by dividing net loss available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing Diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is antidilutive.

 

FAIR VALUE OF FINANCIAL INSTRUMENTS ASC 820, "Fair Value Measurements" and ASC 825, Financial Instruments, requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. It establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument's categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. It prioritizes the inputs into three levels that may be used to measure fair value:

 

Level 1

 

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

 

Level 2

 

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

 

Level 3

 

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

 

The following schedule summarizes the valuation of financial instruments at fair value on a recurring basis in the balance sheets as of September 30, 2015 and December 31, 2014:

 

Level 1

Level 2

Level 3

Derivative Liability

September 30, 2015

$

–

$

–

$

372,472

December 31, 2014

$

–

$

–

$

–

 

There were no transfers of financial assets or liabilities between Level 1 and Level 2 inputs for the nine months ended September 30, 2015 and the year ended December 31, 2014.

 

7

 

RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS

 

In June 2014, the FASB issued an accounting standard which provides new guidance that requires share-based compensation to meet a specific performance target to be achieved in order for employees to become eligible to vest in the awards and that could be achieved after an employee completes the requisite service period be treated as a performance condition. As such, the performance target should not be reflected in estimating the grant date fair value of the award. Compensation costs should be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable to the period(s) for which the requisite service has already been rendered. If the performance target becomes probable of being achieved before the end of the requisite service period, the remaining unrecognized compensation cost should be recognized prospectively over the remaining requisite service period. The total amount of compensation cost recognized during and after the requisite service period should reflect the number of awards that are expected to vest and should be adjusted to reflect those awards that ultimately vest. The requisite service period ends when the employee can cease rendering service and still be eligible to vest in the award if the performance target is achieved. This new guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2015. Early adoption is permitted. Entities may apply the amendments in this Update either (a) prospectively to all awards granted or modified after the effective date or (b) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. The adoption of ASU 201412 is not expected to have a material impact on our financial position or results of operations. 

 

In August 2014, the FASB issued an accounting standard that requires management to assess an entity's ability to continue as a going concern by incorporating and expanding upon certain principles that are currently in U.S. auditing standards. Specifically, the standard (1) provide a definition of the term substantial doubt, (2) require an evaluation every reporting period including interim periods, (3) provide principles for considering the mitigating effect of management's plans, (4) require certain disclosures when substantial doubt is alleviated as a result of consideration of management's plans, (5) require an express statement and other disclosures when substantial doubt is not alleviated, and (6) require an assessment for a period of one year after the date that the financial statements are issued (or available to be issued). The standard in this Update is effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The adoption of ASU 201415 is not expected to have a material impact on our financial position or results of operations.

 

In November 2014, the FASB issued new guidance for determining when separation of certain embedded derivative features in a hybrid financial instrument is required. That is, an entity will continue to evaluate whether the economic characteristics and risks of the embedded derivative feature are clearly and closely related to those of the host contract, among other relevant criteria. The amendments clarify how current GAAP should be interpreted in evaluating the economic characteristics and risks of a host contract in a hybrid financial instrument that is issued in the form of a share. The effects of initially adopting the amendments in this Update should be applied on a modified retrospective basis to existing hybrid financial instruments issued in the form of a share as of the beginning of the fiscal year for which the amendments are effective. Retrospective application is permitted to all relevant prior periods. The adoption of ASU 201416 is not expected to have a material impact on our financial position or results of operations.

 

In November 2014, the FASB issued guidance to provide an acquired entity with an option to apply pushdown accounting in its separate financial statements upon occurrence of an event in which an acquirer obtains control of the acquired entity. After the effective date, an acquired entity can make an election to apply the guidance to future change-in-control events or to its most recent change-in-control event. However, if the financial statements for the period in which the most recent change-in-control event occurred already have been issued or made available to be issued, the application of this guidance would be a change in accounting principle. The amendments in this Update are effective on November 18, 2014. The adoption of ASU 201417 is not expected to have a material impact on our financial position or results of operations.

 

During the second quarter of 2015, the Company adopted guidance codified in ASU 2015-03, Interest - Imputation of Interest (Subtopic 835-30), Simplifying the Presentation of Debt Issuance Costs. The guidance simplifies the presentation of debt issuance costs by requiring debt issuance costs to be presented as a deduction from the corresponding liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs is not affected. Therefore, these costs will continue to be amortized as interest expense using the effective interest method pursuant to ASC 835-30-35-2 through 35-3. The Company elected to early adopt the requirements of ASU 2015-03 effective during the second quarter ended June 30, 2015 and applied this guidance retrospectively to all prior periods presented in the Company's financial statements. The reclassification does not impact net income (loss) as previously reported or any prior amounts reported on the Consolidated Balance Sheets, Consolidated Statements of Comprehensive Income (Loss) or the Consolidated Statements of Cash Flows.

 

8

 

NOTE 3. DISCONTINUED OPERATIONS

 

The Company discontinued its activities in the oil and gas industry and is focusing its activities on the marijuana consulting industry. In discontinuing its oil and gas operations, the Company incurred a $465,000 loss on discontinued operations during the nine months ended September 30, 2014. Historically the carrying value of the oil and gas properties that the Company owned were expensed in accordance with Generally Accepted Accounting Principles for the industry. The Company does not have proven reserves confirmed with a geological study and will only be able to capitalize properties once reserves have been proven. The following is a summary of the properties which the Company discontinued.

 

Innex Drilling and Participation Agreement

 

On December 16, 2013, the Company entered into a Participation Agreement with Innex California Inc. and General Crude Oil Company (together referred to as "Innex JV") for the following projects (1) The Kettleman Dome Project ("KDEP"); (2) the Kettlemen Middle Dome McAdams ("KMDM"), (3) East Elk Hills ("EEH"), (4) South Tapo Canyon ("STC"); (5) Eel River; (6) the Oklahoma ("OK"), (7) the Kettledome Middledome Shallow ("KMDS" and (8) the West Side Joint Venture ("USJV") . Under the terms of this Innex JV, the Company has the right to earn a 50% working interest in each well in which the Company funds. In order to maintain Innex JV, the Company must fund one well in each of the aforementioned projects or risk losing the right to fund. The Company must also fund Innex JV general and administrative costs of $40,000 per month.

 

The first quarter budget was approximately $5.77 million. The budget was delivered to the Company on March 1, 2014. Under the terms of the Innex JV, the Company was to fund the Innex JV the budget requirements by March 15, 2014. During the quarter the Company made lease payments totaling $465,000 to the Innex JV. However, the Company could not meet the terms of the budget requirement and on April 1, 2014, the Company announced that it was divesting itself of the Innex JV.

 

NOTE 4. RELATED PARTY TRANSACTIONS

 

The related party accounts payable to shareholders are $211,311 and $230,701 as of September 30, 2015 and December 31, 2014, respectively for accrued salary.

 

On July 1, 2014, the Company entered into an agreement with a related party to convert $226,785 advances to a convertible promissory note. The note is due on January 1, 2015 and carries a fixed convertible price of $0.01 and interest rate of 5%. On the same date, the related party assigned $186,000 of the principal to 23 third parties. As a result of the fixed conversion price, the Company recognized and expensed a discount of $226,785 as of December 31, 2014. On February 15, 2015, $226,000 of this convertible promissory note was converted into 22,600,000 shares; due to conversion within the terms of the agreement, no loss or gain was recognized. As of September 30, 2015, the balance of the note is $785 and accrued interest is $6,342.

 

During 2008, a former related party incurred $4,157 of expenses on behalf of the Company. There are no repayment terms or interest. As of September 30, 2015, the Company imputed interest at 15% resulting in an interest expense of $467.

 

During 2010, the Company advanced from a related party $815 for expenses. There are no repayment terms or interest. As of September 30, 2015, the Company imputed interest at 15% resulting in an interest expense of $93.

 

During 2011, the Company's past president advanced the Company $2,500. There are no repayment terms or interest. As of September 30, 2015, the Company imputed interest at 15% resulting in an interest expense of $281.

 

During 2013, the Company advanced from a related party $1,445 for expenses. There are no repayment terms or interest. During 2014, the Company repaid back $910 leaving a remaining balance of $535 as of September 30, 2015. The Company imputed interest at 15% resulting in an interest expense of $60.

 

At September 30, 2015, the CEO of the Company was owed $21,149 ($24,206 as at December 31, 2014) from the Company relating to advances for reimbursement of expenses. There are no repayment terms or interest. The Company imputed interest at 15% resulting in an interest expense of $2,984.

 

9

  

NOTE 5. CONVERTIBLE PROMISSORY NOTE

 

	a)	On July 1, 2014, the Company entered into a $226,785 5% Convertible Note with a related party. Under the terms of the Convertible Note, all principal and interest is due on January 1, 2015. The Convertible Note is convertible at any time at the related party's option into shares of the Company's common stock at a fixed conversion price of $0.01. As a result of the fixed conversion price, the Company recognized and expensed a discount of $226,785. As at September 30, 2015, the Company has converted $226,000 of principal into 22,600,000 shares of common stock. Due to conversion within the term of the note, no gain or loss was recognized. As of September 30, 2015 the Company has recorded interest of $6,342.
	b)	On June 3, 2015, the Company entered into a $95,000 8% Convertible Note with a non-related third party. Under the terms of the note, the Company received $47,500 principal upon closing of the note and the Company was to receive the remaining principal in one or more installments with a Maturity Date of June 1, 2016. The Convertible Note is convertible at any time at the third party's option into shares of the Company's common stock at a variable conversion price of 60% of the lowest traded price during the 20 days prior to the notice of conversion, subject to adjustment as described in the convertible debenture. According to the terms of the Convertible Note agreement, the Company may request, after eight months from the original issuance date, the remaining $47,500. If the Company's common stock has a closing bid price of less than $0.10 per share for at least 5 consecutive trading days or the aggregate dollar trading volume of the Company's common stock is less than $40,000 in any 5 consecutive trading days, then the issuer can cancel the remaining portion of the note. Subsequent to the issuance of this note, the aggregate dollar trading volume of the Company's common stock fell below $40,000 for a 5 consecutive trading day period. As at September 30, 2015, the Company has received proceeds of $45,000, net of financing costs of $2,500 which has been recorded as a discount, and has recorded interest of $1,256.
		The embedded conversion option qualifies for derivative accounting and bifurcation under ASC 815-15 Derivatives and Hedging. The initial fair value of the conversion feature of $57,838 resulted in an additional discount to the note payable of $45,000 and the remaining $12,838 was recognized as a loss on changes in fair value of derivative liability. During the nine months ended September 30, 2015, the Company recorded accretion of $7,515 increasing the carrying value of the note to $7,515.
	c)	On June 4, 2015, the Company entered into a $75,000 10% Convertible Note with a non-related third party. Under the terms of the Convertible Note, all principal and interest is due on June 4, 2016. The convertible note is convertible at any time at the third party's option into shares of the Company's common stock at the lesser of: (1) the closing price of the Company's common stock immediately prior to the closing date; or (2) a variable conversion price of 55% of the lowest traded price during the 25 days prior to the notice of conversion, subject to adjustment as described in the convertible debenture. As at September 30, 2015, the Company has received proceeds of $66,250, net of a discount of $8,750, and has recorded interest of $2,418. The Company incurred additional financing costs of $6,000 which has been recorded as a discount.
		The embedded conversion option qualifies for derivative accounting and bifurcation under ASC 815-15 Derivatives and Hedging. The initial fair value of the conversion feature of $108,722 resulted in an additional discount to the note payable of $60,250 and the remaining $48,472 was recognized as a loss on changes in fair value of derivative liability. During the nine months ended September 30, 2015, the Company recorded accretion of $16,364 increasing the carrying value of the note to $16,364.
	d)	On June 10, 2015, the Company entered into a $258,000 10% Convertible Note with a non-related third party. Under the terms of the Convertible Note, the Company received $93,000 principal upon closing of the note and the Company was to receive the remaining principal in one or more installments with a Maturity Date of June 1, 2016. The convertible note is convertible at any time at the third party's option into shares of the Company's common stock at $0.50, subject to adjustment as described in the convertible note. As at September 30, 2015, the Company has received proceeds of $80,000, net of a discount of $8,000 and financing costs of $5,000 which has been recorded as a discount, and has recorded interest of $4,867. The Company incurred additional financing costs of $8,000 which has been recorded as a discount.

10

 

In addition, the Company will grant 4 warrants to purchase shares of common stock. The number of shares the warrant is exercisable into is equal to the following:

 

		1.	$46,500 divided by the Market Price on the issuance date.(issuable)
		2.	$27,500 divided by the Market Price on the issuance date.
		3.	$27,500 divided by the Market Price on the issuance date.
		4.	$27,500 divided by the Market Price on the issuance date.

 

As at September 30, 2015, the company has not issued warrants pursuant to the convertible note. The warrants are exercisable at $0.50 per share.

 

The first tranche of warrants issuable and the embedded conversion option qualify for derivative accounting and bifurcation under ASC 815-15 Derivatives and Hedging. The initial fair value of the conversion feature of $103,533 for the convertible note and $68,606 for the warrants resulted in an additional discount to the note payable of $72,000 and the remaining $100,139 was recognized as a loss on changes in fair value of derivative liability. During the nine months ended September 30, 2015, the Company recorded accretion of $12,018 increasing the carrying value of the note to $12,018.

 

	e)	On June 11, 2015, the Company entered into a $66,250 10% Convertible Note with a non-related third party. Under the terms of the Convertible Note, all principal and interest is due on March 11, 2016. The convertible note is convertible at any time at the third party's option into shares of the Company's common stock at the lesser of: (1) a variable conversion price of 55% of the lowest traded price during the 25 days prior to the issuance of the note; or (2) a variable conversion price of 55% of the lowest traded price during the 25 days prior to the notice of conversion, subject to adjustment as described in the convertible note. As at September 30, 2015, the Company has received proceeds of $60,000, net of a discount of $3,500, financing costs of $2,750 which has been recorded as a discount and has recorded interest of $2,684. The Company incurred additional financing costs of $10,500 which has been recorded as a discount.
		The embedded conversion option qualifies for derivative accounting and bifurcation under ASC 815-15 Derivatives and Hedging. The initial fair value of the conversion feature of $93,623 resulted in an additional discount to the note payable of $49,500 and the remaining $44,123 was recognized as a loss on changes in fair value of derivative liability. During the nine months ended September 30, 2015, the Company recorded accretion of $9,746 increasing the carrying value of the note to $9,746.

 

NOTE 6. DERIVATIVE LIABILITIES

 

The embedded conversion options of the Company's convertible debentures described in Note 5 contain conversion features that qualify for embedded derivative classification. The fair value of these liabilities will be re-measured at the end of every reporting period and the change in fair value will be reported in the statement of operations as a gain or loss on derivative liabilities.

 

11

 

The table below sets forth a summary of changes in the fair value of the Company's Level 3 financial liabilities:

 

		For the Nine Months Ended September 30, 2015
Balance at the beginning of period		$	–
Fair value of new derivative liabilities (embedded conversion option)			432,322
Change in fair value of derivative			(59,850	)
Balance at end of period		$	372,472

 

The derivative instruments were valued at loan origination date and at September 30, 2015, The fair values of the derivative liabilities related to the conversion options of these notes was estimated on the transaction dates using the Multinomial Lattice option pricing model.: The model incorporates the price of a share of the Company's common stock (as quoted on the Over the Counter Bulletin Board), volatility, risk free rate, dividend rate and estimated life. Significant changes in any of these inputs in isolation would result in a significant change in the fair value measurement. The following table shows the assumptions used in the calculations:

 

		Expected Volatility				Risk-Free Interest Rate		Expected Dividend Yield				Expected Life (in years)
At Issuance		264% - 270		%		0.08% - 0.28	%		0	%		0.75 - 1.08
At September 30, 2015			305	%		0.00% - 0.08	%		0	%		0.45 - 0.78

 

NOTE 7. STOCKHOLDERS' EQUITY

 

On January 17, 2014 the Company entered into a Private Placement Agreement to issue up to 35,714 shares of Common Stock at $22.40 per share. The Company has received $468,200 by way of subscription agreements. The 20,902 shares were issued on May 23, 2014.

 

On February 28, 2014 the Company issued 3,571 warrants to a consultant. The warrants have an exercise price of $11.20 per share and have a life of ten years. The warrants were fully vested and expensed on the date of grant. The Company valued these warrants using the Black-Scholes option pricing model totaling $104,997 under the following assumptions: $30.80 stock price, 10 years to maturity, 365% volatility, 1.51% risk free rate. During the same period, the consultant exercised on a cashless basis and received 3,571 shares of common stock.

 

On February 28, 2014 the Company issued 8,036 warrants to a consultant. The warrants have an exercise price of $11.20 per share and have a life of ten years. The warrants were fully vested and expensed on the date of grant. The Company valued these warrants using the Black-Scholes option pricing model totaling $241,869 under the following assumptions: $30.80 stock price, 10 years to maturity, 365% volatility, 1.51% risk free rate. During the same period, the consultant exercised on a cashless basis and received 8,036 shares of common stock.

 

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On February 28, 2014 the Company issued 893 warrants to a consultant. The warrants have an exercise price of $11.20 per share and have a life of ten years. The warrants were fully vested and expensed on the date of grant. The Company valued these warrants using the Black-Scholes option pricing model totaling $26,874 under the following assumptions: $30.80 stock price, 10 years to maturity, 365% volatility, 1.51% risk free rate. During the same period, the consultant exercised on a cashless basis and received 893 shares of common stock.

 

On April 1, 2014 the Company issued 1,250 shares as settlement for services provided. Given the market price of $28.00 as April 1, 2014, the Company valued the shares at $35,000 based on fair market value of the closing price on the date of grant. Due to the shares being issued the Company has expensed this value.

 

On April 17, 2014, the Company extended an Investor Relations Consulting Agreement with San Diego Torrey Hills Capital, Inc. for an additional nine months. The Company has issued 2,679 shares. Given the market price of $22.40 as April 17, 2014, the Company has valued the shares at $60,000 based on fair market value of the closing price on the date of grant. Due to the shares being issued the Company has expensed this value.

 

On April 17, 2014 the Company issued 6,786 warrants to a consultant. The warrants have an exercise price of $11.20 per share and have a life of ten years. The warrants were fully vested and expensed on the date of grant. The Company valued these warrants using the Black-Scholes option pricing model totaling $151,965 under the following assumptions: $22.40 stock price, 10 years to maturity, 320% volatility, 1.75% risk free rate. During the same period, the consultant exercised on a cashless basis and received 6,786 shares of common stock.

 

On April 17, 2014 the Company issued 7,857 warrants to a consultant. The warrants have an exercise price of $11.20 per share and have a life of ten years. The warrants were fully vested and expensed on the date of grant. The Company valued these warrants using the Black-Scholes option pricing model totaling $175,960 under the following assumptions: $22.40 stock price, 10 years to maturity, 320% volatility, 1.75% risk free rate. During the same period, the consultant exercised on a cashless basis and received 7,857 shares of common stock.

 

On June 9, 2014 the Company issued 4,464 shares as settlement for services provided. Given the market price of $19.60 as June 9, 2014, the Company valued the shares at $87,500 based on fair market value of the closing price on the date of grant. Due to the shares being issued the Company has expensed this value.

 

On June 15, 2014 the Company issued 1,063 shares as settlement for services provided. Given the market price of $13.99 as June 15, 2014, the Company valued the shares at $14,875 based on fair market value of the closing price on the date of grant. Due to the shares being issued the Company has expensed this value.

 

On June 17, 2014 the Company issued 8,036 shares as settlement for services provided. Given the market price of $14.00 as June 17, 2014, the Company valued the shares at $112,500 based on fair market value of the closing price on the date of grant. Due to the shares being issued the Company has expensed this value.

 

On June 20, 2014, the Company issued 17,857 warrants to a consultant. The warrants have an exercise price of $11.20 per share and have a life of ten years. The warrants were fully vested and expensed on the date of grant. The Company valued these warrants using the Black-Scholes option pricing model totaling $399,909 under the following assumptions: $11.20 stock price, 10 years to maturity, 320% volatility, 1.75% risk free rate. One consultant exercised on a cashless basis and received 17,857 shares of common stock.

 

On February 15, 2015, $226,000 of the $226,785 convertible promissory note was converted into 22,600,000 shares of common stock. The remaining amount of the convertible note $785 is due to Harp Sangha, president of the Company.

 

On May 12, 2015, the Company completed a private placement for the issuance of 800,000 shares of common stock for proceeds of $40,000.

 

NOTE 8. SUBSEQUENT EVENTS

 

In accordance with ASC 855-10, management has reviewed all material events through the date of this report and has determined there are no material subsequent events to disclose.

 

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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

 

FORWARD-LOOKING STATEMENTS

 

The information set forth in this section contains certain "forward-looking statements," including, among other things, (i) expected changes in our revenues and profitability, (ii) prospective business opportunities, and (iii) our strategy for financing our business. Forward-looking statements are statements other than historical information or statements of current condition. Some forward-looking statements may be identified by use of terms such as "believes," "anticipates," "intends," or "expects." These forward-looking statements relate to our plans, objectives and expectations for future operations. Although we believe that our expectations with respect to the forward-looking statements are based upon reasonable assumptions within the bounds of our knowledge of our business and operations, in light of the risks and uncertainties inherent in all future projections, the inclusion of forward-looking statements in this report should not be regarded as a representation by us or any other person that our objectives or plans will be achieved.

 

PLAN OF OPERATION – CONTINUING OPERATIONS

 

Company changed its business as of April 1, 2014 to the medical science consulting business from the oil and gas business, initially targeting on the pharmaceutical benefits of marijuana. Currently, we are in the process of establishing agreements with certain scientists.

 

During the nine months ended September 30, 2015, the Company's loss from continuing operations was $521,162, as compared to $2,063,079 for the nine months ended September 30, 2014. The decrease in loss of $1,541,917 was a result of decreased consulting expenses to $298,275 for the nine months ended September 30, 2015 from $1,821,367 for the nine months ended September 30, 2014.

 

During the three months ended September 30, 2015, the Company's net loss and loss from continuing operations was $106,605, as compared to $371,757 for the three months ended September 30, 2014. The decrease in loss of $265,152 was a result of decreased consulting expenses to $84,746 for the three months ended September 30, 2015 from $199,963 for the three months ended September 30, 2014 and decreased interest expense to $36,270 for the three months ended September 30, 2015 from $118,308 for the three months ended September 30, 2014.

 

On May 7, 2014, the Company shifted its business to the business of the business of providing pharmaceutical applications initially from marijuana. To this end the Company has been conducting due diligence on several acquisition targets.

 

As we are in the process of changing businesses a number of the risks of the new business are discussed as follows:

 

Because we have no operating history in the cannabis industry, we may not succeed. 

 

While our CEO, Harp Sangha, has experience in real estate transactions and in the public markets, we have no specific operating history or experience in procuring, building out or leasing real estate for agricultural purposes, specifically marijuana grow facilities, or with respect to any other activity in the cannabis industry. Moreover, we are subject to all risks inherent in a developing a new business enterprise. Our likelihood of success must be considered in light of the problems, expenses, difficulties, complications, and delays frequently encountered in connection with establishing a new business and the competitive and regulatory environment in which we operate. For example, the medical marijuana industry is new and may not succeed, particularly should the federal government change course and decide to prosecute those dealing in medical marijuana. If that happens there may not be an adequate market for our properties or other activities we propose to engage in.

 

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You should further consider, among other factors, our prospects for success in light of the risks and uncertainties encountered by companies that, like us, are in their early stages. For example, unanticipated expenses, delays and or complications with build outs, zoning issues, legal disputes with neighbors, local governments, communities and or tenants. We may not successfully address these risks and uncertainties or successfully implement our operating strategies. If we fail to do so, it could materially harm our business to the point of having to cease operations and could impair the value of our common stock to the point investors may lose their entire investment.

 

Because we may be unable to identify and/or successfully develop or acquire assets which are suitable for our business, our financial condition may be negatively affected.

 

Our business plan involves the identification and the successful pharmaceutical applications utilizing marijuana. We do not know whether we will be successful in identifying or successfully developing or acquiring assets of economic value.

 

Because our business is dependent upon continued market acceptance by consumers, any negative trends will adversely affect our business operations.

 

We are substantially dependent on continued market acceptance and proliferation of consumers of medical marijuana. We believe that as marijuana becomes more accepted the stigma associated with marijuana use will diminish and as a result consumer demand will continue to grow. And while we believe that the market and opportunity in the marijuana space continues to grow, we cannot predict the future growth rate and size of the market. Any negative outlook on the marijuana industry will adversely affect our business operations. 

 

In addition, it is believed by many that large well-funded businesses may have a strong economic opposition to the cannabis industry. We believe that the pharmaceutical industry clearly does not want to cede control of any product that could generate significant revenue. For example, medical marijuana will likely adversely impact the existing market for the current "marijuana pill" sold by the mainstream pharmaceutical industry, should marijuana displace other drugs or encroach upon the pharmaceutical industry's products. The pharmaceutical industry is well funded with a strong and experienced lobby that eclipses the funding of the medical marijuana movement. Any inroads the pharmaceutical industry could make in halting the impending cannabis industry could have a detrimental impact on our proposed business. 

 

Because marijuana is illegal under federal law, we could be subject to criminal and civil sanctions for engaging in activities that violate those laws.

 

The U.S. Government classifies marijuana as a schedule-I controlled substance. As a result, marijuana is an illegal substance under federal law. Even in those jurisdictions in which the use of medical marijuana has been legalized at the state level, its prescription is a violation of federal law. The United States Supreme Court has ruled in United States v. Oakland Cannabis Buyers' Coop. and Gonzales v. Raich that it is the federal government that has the right to regulate and criminalize cannabis, even for medical purposes. Therefore, federal law criminalizing the use of marijuana pre-empts state laws that legalizes its use for medicinal purposes. 

 

As of November 12, 2014, 22 states and the District of Columbia allow its citizens to use medical marijuana. Additionally, voters in the states of Colorado, Alaska, Oregon and Washington approved ballot measures to legalize cannabis for adult use. The state laws are in conflict with the federal Controlled Substances Act, which makes marijuana use and possession illegal on a national level. The Obama administration has effectively stated that it is not an efficient use of resources to direct law federal law enforcement agencies to prosecute those lawfully abiding by state-designated laws allowing the use and distribution of medical marijuana. However, there is no guarantee that the administration will not change its stated policy regarding the low-priority enforcement of federal laws. Additionally, any new administration that follows could change this policy and decide to enforce the federal laws strongly. Any such change in the federal government's enforcement of current federal laws could cause significant financial damage to us and our shareholders. 

 

We will require medical marijuana for our research facilities. Consequently we will be required to follow the strict guidelines required by regulation for the management of our facilities.

 

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Laws and regulations affecting the regulated marijuana industry are constantly changing, which could detrimentally affect our proposed operations, and we cannot predict the impact that future regulations may have on us.

 

Local, state and federal medical marijuana laws and regulations are broad in scope and subject to evolving interpretations, which could require us to incur substantial costs associated with compliance or alter our business plan. In addition, violations of these laws, or allegations of such violations, could disrupt our business and result in a material adverse effect on its operations. In addition, it is possible that regulations may be enacted in the future that will be directly applicable to our proposed business. We cannot predict the nature of any future laws, regulations, interpretations or applications, nor can we determine what effect additional governmental regulations or administrative policies and procedures, when and if promulgated, could have on our business.

 

FDA regulation of marijuana and the possible registration of facilities where medical marijuana is grown could negatively affect the cannabis industry which would directly affect our financial condition. 

 

Should the federal government legalize marijuana for medical use, it is possible that the U.S. Food and Drug Administration (FDA) would seek to regulate it under the Food, Drug and Cosmetics Act of 1938. Additionally, the FDA may issue rules and regulations including cGMPs (certified good manufacturing practices) related to the growth, cultivation, harvesting and processing of medical marijuana. Clinical trials may be needed to verify efficacy and safety. It is also possible that the FDA would require that facilities where medical marijuana is grown be registered with the FDA and comply with certain federally prescribed regulations. In the event that some or all of these regulations are imposed, we do not know what the impact would be on the medical marijuana industry, what costs, requirements and possible prohibitions may be enforced. If we or our tenants are unable to comply with the regulations and or registration as prescribed by the FDA, we and/or our tenants may be unable to continue to operate their and our business in its current form or at all. 

 

Because our business model depends upon the availability of private financing, any change in our ability to raise money will adversely affect our financial condition.

 

Our ability to operate laboratory and manufacturing facilities, engage in the business activities that we have planned and achieve positive financial performance depends, in large measure, on our ability to obtain financing in amounts and on terms that are favorable. The capital markets in the United States have recently undergone a turbulent period in which lending was severely restricted. Although there appears to be signs that financial institutions are resuming lending, the market has not yet returned to its pre-2008 state. Obtaining favorable financing in the current environment remains challenging.

 

Because we are liable for hazardous substances on our properties, environmental liabilities are possible and can be costly.

 

Federal, state and local laws impose liability on a landowner for releases or the otherwise improper presence on the premises of hazardous substances. This liability is without regard to fault for, or knowledge of, the presence of such substances. A landowner may be held liable for hazardous materials brought onto a property before it acquired title and for hazardous materials that are not discovered until after it sells the property. Similar liability may occur under applicable state law. Sellers of properties may make only limited representations as to the absence of hazardous substances. If any hazardous materials are found within our properties in violation of law at any time, we may be liable for all cleanup costs, fines, penalties and other costs. This potential liability will continue after we sell the properties and may apply to hazardous materials present within the properties before we acquire the properties. If losses arise from hazardous substance contamination which cannot be recovered from a responsible party, the financial viability of the properties may be adversely affected. It is possible that we will purchase properties with known or unknown environmental problems which may require material expenditures for remediation. 

 

16

 

Because we may not be adequately insured, we could experience significant liability for uninsured events.

 

While we intend to carry comprehensive insurance on our properties, including fire, liability and extended coverage insurance, there are certain risks that may be uninsurable or not insurable on terms that management believes to be economical. For example, management may not obtain insurance against floods, terrorism, mold-related claims, or earthquake insurance. If such an event occurs to, or causes the damage or destruction of, a property, we could suffer financial losses. 

 

If we are found non-compliance with the Americans with Disabilities Act, we will be subject to significant liabilities. 

 

If any of our properties are not in compliance with the Americans with Disabilities Act of 1990, as amended (the "ADA"), we may be required to pay for any required improvements. Under the ADA, public accommodations must meet certain federal requirements related to access and use by disabled persons. The ADA requirements could require significant expenditures and could result in the imposition of fines or an award of damages to private litigants. We cannot assure that ADA violations do not or will not exist at any of our properties.

 

The following table provides selected financial data about our company as of September 30, 2015 and December 31, 2014.

 

Balance Sheet Data		September 30, 2015				December 31, 2014
Cash		$	812			$	128
Liabilities		$	1,053,265			$	794,638
Stockholders' Deficit		$	(1,045,786	)		$	(794,510	)

 

LIQUIDITY AND CAPITAL RESOURCES

 

Our cash balance at September 30, 2015 was $812 with outstanding liabilities of $1,053,265. Management believes our current cash balance will be unable to sustain operations for the next 12 months. We will be forced to raise additional funds by issuing new debt or equity securities or otherwise. If we fail to raise sufficient capital when needed, we will not be able to complete our business plan. We are a development stage company and have generated no revenue to date.

 

PLAN OF OPERATION

 

Our cash balance is $812 as of September 30, 2015. We believe our cash balance is insufficient to fund our levels of operations for the next twelve months. As a result we will be forced to raise additional funds by issuing new debt or equity securities or otherwise. If we fail to raise sufficient capital when needed, we will not be able to complete our business plan. We have generated no revenue to date.

 

This means that there is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional capital to pay our bills. This is because we have generated minimal revenues to date. There is no assurance we will ever achieve profitability.

 

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OFF-BALANCE SHEET ARRANGEMENTS

 

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.

 

CRITICAL ACCOUNTING POLICIES

 

In June 2014, the Financial Accounting Standards Board issued Accounting Standards Update No. 2014-10, which eliminated certain financial reporting requirements of companies previously identified as "Development Stage Entities" (Topic 915). The amendments in this ASU simplify accounting guidance by removing all incremental financial reporting requirements for development stage entities. The amendments also reduce data maintenance and, for those entities subject to audit, audit costs by eliminating the requirement for development stage entities to present inception-to-date information in the statements of income, cash flows, and shareholder equity. Early application of each of the amendments is permitted for any annual reporting period or interim period for which the entity's financial statements have not yet been issued (public business entities) or made available for issuance (other entities). Upon adoption, entities will no longer present or disclose any information required by Topic 915. The Company has adopted this standard.

 

In June 2014, the FASB issued an accounting standard which provides new guidance that requires share-based compensation to meet a specific performance target to be achieved in order for employees to become eligible to vest in the awards and that could be achieved after an employee completes the requisite service period be treated as a performance condition. As such, the performance target should not be reflected in estimating the grant date fair value of the award. Compensation costs should be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable to the period(s) for which the requisite service has already been rendered. If the performance target becomes probable of being achieved before the end of the requisite service period, the remaining unrecognized compensation cost should be recognized prospectively over the remaining requisite service period. The total amount of compensation cost recognized during and after the requisite service period should reflect the number of awards that are expected to vest and should be adjusted to reflect those awards that ultimately vest. The requisite service period ends when the employee can cease rendering service and still be eligible to vest in the award if the performance target is achieved. This new guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2015. Early adoption is permitted. Entities may apply the amendments in this Update either (a) prospectively to all awards granted or modified after the effective date or (b) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. The adoption of ASU 201412 is not expected to have a material impact on our financial position or results of operations.

 

In August 2014, the FASB issued an accounting standard that requires management to assess an entity's ability to continue as a going concern by incorporating and expanding upon certain principles that are currently in U.S. auditing standards. Specifically, the standard (1) provide a definition of the term substantial doubt, (2) require an evaluation every reporting period including interim periods, (3) provide principles for considering the mitigating effect of management's plans, (4) require certain disclosures when substantial doubt is alleviated as a result of consideration of management's plans, (5) require an express statement and other disclosures when substantial doubt is not alleviated, and (6) require an assessment for a period of one year after the date that the financial statements are issued (or available to be issued). The standard in this Update is effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The adoption of ASU 201415 is not expected to have a material impact on our financial position or results of operations.

 

In November 2014, the FASB issued new guidance for determining when separation of certain embedded derivative features in a hybrid financial instrument is required. That is, an entity will continue to evaluate whether the economic characteristics and risks of the embedded derivative feature are clearly and closely related to those of the host contract, among other relevant criteria. The amendments clarify how current GAAP should be interpreted in evaluating the economic characteristics and risks of a host contract in a hybrid financial instrument that is issued in the form of a share. The effects of initially adopting the amendments in this Update should be applied on a modified retrospective basis to existing hybrid financial instruments issued in the form of a share as of the beginning of the fiscal year for which the amendments are effective. Retrospective application is permitted to all relevant prior periods. The adoption of ASU 201416 is not expected to have a material impact on our financial position or results of operations.

 

18

 

In November 2014, the FASB issued guidance to provide an acquired entity with an option to apply pushdown accounting in its separate financial statements upon occurrence of an event in which an acquirer obtains control of the acquired entity. After the effective date, an acquired entity can make an election to apply the guidance to future change-in-control events or to its most recent change-in-control event. However, if the financial statements for the period in which the most recent change-in-control event occurred already have been issued or made available to be issued, the application of this guidance would be a change in accounting principle. The amendments in this Update are effective on November 18, 2014. The adoption of ASU 201417 is not expected to have a material impact on our financial position or results of operations.

 

During the second quarter of 2015, the Company adopted guidance codified in ASU 2015-03, Interest - Imputation of Interest (Subtopic 835-30), Simplifying the Presentation of Debt Issuance Costs. The guidance simplifies the presentation of debt issuance costs by requiring debt issuance costs to be presented as a deduction from the corresponding liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs is not affected. Therefore, these costs will continue to be amortized as interest expense using the effective interest method pursuant to ASC 835-30-35-2 through 35-3. The Company elected to early adopt the requirements of ASU 2015-03 effective during the second quarter ended June 30, 2015 and applied this guidance retrospectively to all prior periods presented in the Company's financial statements. The reclassification does not impact net income (loss) as previously reported or any prior amounts reported on the Consolidated Balance Sheets, Consolidated Statements of Comprehensive Income (Loss) or the Consolidated Statements of Cash Flows.

 

ITEM 4. CONTROLS AND PROCEDURES

 

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

 

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934 , as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and communicated to our management, including our president (also our principal executive officer) and our secretary, treasurer and chief financial officer (also our principal financial and accounting officer) to allow for timely decisions regarding required disclosure.

 

As of September 30, 2015, we carried out an evaluation, under the supervision and with the participation of our president (also our principal executive officer), and our chief financial officer (also our principal financial and accounting officer) of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our President and Chief Financial Officer concluded that our disclosure controls and procedures were not effective in providing reasonable assurance in the reliability of our corporate reporting as of the end of the period covered by this Quarterly Report due to certain deficiencies that existed in the design or operation of our internal controls over financial reporting as disclosed below and that may be considered to be material weaknesses.

 

CHANGES IN INTERNAL CONTROLS.

 

There was no change in our internal controls or in other factors that could affect these controls during our last fiscal quarter that has materially affected, or is reasonably likely to materially affect our internal control over financial reporting.

 

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PART II - OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDINGS

 

We are not a party to any material legal proceedings and to our knowledge, no such proceedings are threatened or contemplated.

 

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS

 

Not applicable.

 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

 

None.

 

ITEM 4. MINE SAFETY DISCLOSURES

 

None.

 

ITEM 5. OTHER INFORMATION

 

On April 1, 2014 our Chief Financial Officer and Director Hermander Rai resigned, consequently Mr. Hapreet Sanga, the Company's President, took over the Chief Financial Officer position as well.

 

On September 8, 2014 Louis Bobadilla III resigned as a director of the Company.

 

On May 8, 2015 the Board of Directors of the Company has appointed David Alexander as a chief financial officer, effective immediately. Mr. Alexander is a Chartered Accountant with over 25 years' experience in providing audit, accounting, and consulting services to both private and public companies. Currently, Mr. Alexander is a director of Xterra Building Systems Inc. Based upon the aforementioned background and experience, Company principals believe that Mr. Alexander is eminently qualified to discharge the duties required for the directorship of the Company.

 

On May 8, 2015, the Board of Directors of the Company has appointed John M. E. Percival to its Board of Directors and Head of Strategic Business Development. Mr. Percival brings over 20 years of Investment Banking, Corporate Finance and Strategic planning success to Verde. Mr. Percival was previously General Manager of Investments at Barclays Bank New Zealand Ltd., where he was responsible for the management of nearly a $500 million in superannuation and private funds.

 

On July 31, 2015, David Alexander, Chief Financial Officer of the Company resigned from his service as an officer of the Company. The Board of Directors of the Company appointed Harpreet Sangha, the Company's President and Chief Executive Officer, as interim Chief Financial Officer, effective immediately while the Company actively looks for a replacement CFO to replace Mr. Alexander. Mr. Sangha has served as the Chairman of the Board and Chief Executive Officer since 2012 and will continue in this role.

 

On September 18, 2015, Shareholders holding 67% of the Company's voting power removed Bradley J. Dixon and John Percival from the Company's Board of Directors, effective immediately, as authorized by Nevada Revised Statutes (N.R.S.) Section 78.335. The removal of Messrs. Dixon and Percival was not the result of any disagreement. 

 

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ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

 

Exhibit Number		Description of Exhibit
3.1		Articles of Incorporation – Filed by Form SB-1 on March 30, 2007.
3.2		Bylaws – Filed by Form SB-1 on March 30, 2007.
10.1		Lease Acquisition Agreement between the Company and Fredco LLC filed on August 26, 2009, and has been incorporated herein by reference.
10.2		Lease Acquisition Agreement filed on September 9, 2009 and has been incorporated herein by reference.
10.3		Drilling and Participation Agreement filed on May 27, 2014 and has been incorporated herein by reference.
10.4		Farmout and Acquisition Agreement filed on May 17, 2012 and has been incorporated herein by reference.
10.5		Drilling and Participation Agreement filed on May 27, 2014 and has been incorporated herein by reference.
10.6		Consulting Agreement filed on June 7, 2014 and has been incorporated herein by reference.
10.7		Asset Transfer and Liability and Assumption Agreement filed on June 12, 2014 and has been incorporated herein by reference.
10.8		Consulting Agreement filed on July 15, 2014 and has been incorporated herein by reference.
10.9		Financial Participation Agreement filed on August 6, 2014 and has been incorporated herein by reference.
31.1		Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-OxleyAct of 2002, filed herewith.
31.2		Certification of Principal Financial and Accounting Officer pursuant to Section 302 of the Sarbanes-OxleyAct of 2002, filed herewith.
32.1		Certification by Chief Executive Officer, required by Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act, promulgated pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith.
32.2		Certification by Chief Financial Officer, required by Rule 13a-14(b) or Rule 15d-14(b) of the Exchange Act and Section 1350 of Chapter 63 of Title 18 of the United States Code of the Sarbanes-Oxley Act of 2002 filed herewith.
101		Interactive data files pursuant to Rule 405 of Regulation ST.

 

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SIGNATURES

 

In accordance with the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

	Verde Science Inc.
Date: December 14, 2015	By:	/s/ Harpreet Sanga
		Harpreet Sangha,
		President and Director (Principal Executive Officer)

 

  

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EXHIBIT 31.1

 

CERTIFICATION

 

I, Harpreet Sangha, Chief Executive Officer certify that:

 

1.	I have reviewed this report on Form 10-Q of VERDE SCIENCE, INC.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the consolidated financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

	a.	designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b.	designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; and
	c.	evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report, based on our evaluation; and
	d.	disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an quarterly report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

 

5.	The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):

 

	a.	all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
	b.	any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

 

 

Date: December 14, 2015	By:	/s/ Harpreet Sangha
		Harpreet Sangha
		President and Director (Principal Executive Officer)

 

 

EXHIBIT 31.2

 

CERTIFICATION

 

I, Harpreet Sangha, Interim Chief Financial Officer certify that:

 

1.	I have reviewed this report on Form 10-Q of VERDE SCIENCE, INC.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the consolidated financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

	a.	designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b.	designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; and
	c.	evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report, based on our evaluation; and
	d.	disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an quarterly report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

 

5.	The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):

 

	a.	all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
	b.	any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

 

 

Date: December 14, 2015	By:	/s/ Harpreet Sangha
		Harpreet Sangha
		Interim Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)

EXHIBIT 32.1

 

CERTIFICATION OF CHIEF EXECUTIVE OFFICER OF
VERDE SCIENCE, INC.
FORM 10-Q FOR THE SIX MONTH PERIOD ENDED JUNE 30, 2015
PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED
PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Harpreet Sangha, am the Chief Executive Officer of VERDE SCIENCE, INC., a Nevada corporation (the "Company"). I am delivering this certificate in connection with the Quarterly Report on Form 10-Q of the Company for the nine month period ended September 30, 2015 and filed with the Securities and Exchange Commission ("Quarterly Report").

 

Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, I hereby certify that, to the best of my knowledge, the Quarterly Report fully complies with the requirements of Section 13(a) or

Section 15(d) of the Securities Exchange Act of 1934 and that the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

 

Date: December 14, 2015	By:	/s/ Harpreet Sangha
		Harpreet Sangha
		President and Director (Principal Executive Officer)

 

 

EXHIBIT 32.2

 

CERTIFICATION OF CHIEF FINANCIAL OFFICER OF
VERDE SCIENCE, INC.
FORM 10-Q FOR THE SIX MONTH PERIOD ENDED JUNE 30, 2015
PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED
PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Harpreet Sangha, am the Interim Chief Financial Officer of VERDE SCIENCE, INC., a Nevada corporation (the "Company"). I am delivering this certificate in connection with the Quarterly Report on Form 10-Q of the Company for the nine month period ended September 30, 2015 and filed with the Securities and Exchange Commission ("Quarterly Report").

 

Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, I hereby certify that, to the best of my knowledge, the Quarterly Report fully complies with the requirements of Section 13(a) or

 

Section 15(d) of the Securities Exchange Act of 1934 and that the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

 

Date: December 14, 2015	By:	/s/ Harpreet Sangha
		Harpreet Sangha
		Interim Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)

 

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2015	Dec. 08, 2015
Document And Entity Information
Entity Registrant Name	VERDE SCIENCE, INC.
Entity Central Index Key	0001390778
Document Type	10-Q
Document Period End Date	Sep. 30, 2015
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Voluntary Filers	No
Entity Well Known Seasoned Issuer	No
Entity Current Reporting Status	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		23,867,679
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2015

BALANCE SHEETS - USD ($)	Sep. 30, 2015	Dec. 31, 2014
ASSETS
Cash	$ 812	$ 128
Prepaid	6,667
Total Assets	7,479	$ 128
Liabilities
Accounts payable and accrued liabilities	393,898	304,939
Due to related party – accounts payable, net	211,311	230,701
Due to related party – notes payable	29,156	32,213
Due to related party – convertible notes payable	785	$ 226,785
Convertible notes payable, net of discount of $236,107 and $0	45,643
Derivative liabilities	372,472
Total Liabilities	1,053,265	$ 794,638
STOCKHOLDERS’ DEFICIT
Common stock, 100,000,000 shares authorized, $0.001 par value; 23,867,679 and 467,679 issued and outstanding as of September 30, 2015 and December 31, 2014, respectively	23,868	467
Additional paid-in capital	6,464,588	6,218,103
Accumulated comprehensive income	2,803	2,803
Accumulated Deficit	(7,537,045)	(7,015,883)
Total Stockholders’ Deficit	(1,045,786)	(794,510)
Total Liabilities and Stockholders’ Deficit	$ 7,479	$ 128

BALANCE SHEETS (Parenthetical) - USD ($)	Sep. 30, 2015	Dec. 31, 2014
Balance Sheets Parenthetical
Convertible notes payable, net of discount	$ 236,107	$ 0
Common stock, shares authorized	100,000,000	100,000,000
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares issued	23,867,679	467,679
Common stock, shares outstanding	23,867,679	467,679

STATEMENTS OF OPERATIONS (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Revenues
Total Revenues
OPERATING EXPENSES
Accounting and Professional Fees	$ 23,766	$ 38,582	$ 44,949	$ 75,845
Consulting Fees	84,746	199,963	298,275	1,821,367
Office and Administration	11,269	$ 13,904	27,692	$ 30,030
Foreign exchange gain	(11,714)		(56,886)
Total Operating Expenses	108,067	$ 253,449	314,030	$ 1,927,242
NET LOSS FROM OPERATIONS	(108,067)	(253,449)	(314,030)	(1,927,242)
Other Income (Expense)
Net interest expense	(36,270)	$ (118,308)	(61,410)	$ (135,837)
Gain (Loss) on changes in fair value of derivative liability	37,732		(145,722)
Total Other Income (Expense)	1,462	$ (118,308)	(207,132)	$ (135,837)
NET LOSS FROM CONTINUING OPERATIONS	$ (106,605)	$ (371,757)	$ (521,162)	(2,063,079)
Discontinued Operations (Note 3)
Loss from discontinued operations				(465,000)
Net Loss on Discontinued Operations				(465,000)
Net Loss and Comprehensive Loss	$ (106,605)	$ (371,757)	$ (521,162)	$ (2,528,079)
Net Loss Per Share – Basic and Diluted	$ 0	$ (0.81)	$ (0.03)	$ (6.18)
Weighted Average Shares Outstanding	23,867,638	457,294	19,666,905	409,183

STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)	9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014
OPERATING ACTIVITIES
Net loss for the period	$ (521,162)	$ (2,528,079)
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization of debt discount	45,643
Changes in fair value of derivatives	$ 145,722
Payment of services with shares		$ 391,801
Option expense		1,301,538
Imputed interest – related party	$ 3,885	17,425
Discount on note issued to related party		112,160
Changes in operating assets and liabilities:
Accounts payable - related party	$ (5,743)	84,162
Accounts payable	78,965	$ 125,735
Prepaid expenses	(6,667)
Net Cash Used in Operating Activities	(259,357)	$ (495,258)
FINANCING ACTIVITIES
Capital stock issued	40,000	468,200
Proceeds from related party loans	19,853	28,756
Repayment of related party loans	(26,562)	$ (1,357)
Net proceeds from issuance of convertible debt	226,750
Net Cash Provided by Financing Activities	260,041	$ 495,599
INCREASE IN CASH	684	341
Cash, Beginning of Period	128	203
Cash, End of Period	$ 812	$ 544
Supplemental Disclosures
Interest paid
Income taxes paid
Non-Cash Investing and Financing Activities
Cashless exercise of stock options		$ 17,600
Conversion of debt	$ 226,000
Debt discount due to derivatives	$ 226,750
Discount of convertible note, related party		$ 226,785

NATURE OF OPERATIONS	9 Months Ended
	Sep. 30, 2015
Notes to Financial Statements
NOTE - 1 NATURE OF OPERATIONS	DESCRIPTION OF BUSINESS - Verde Science, Inc. (hereinafter referred to as the "Company") was incorporated on January 31, 2007 by filing Articles of Incorporation with the Nevada Secretary of State. The Company was formed to engage in the exploration of resource properties. On January 31, 2012, the Company changed its name from Avro Energy, Inc. to Rango Energy, Inc. On April 2, 2014, the Company announced that it was changing its business and was entering into the pharmaceutical industry focusing on the use of derivatives of cannabis to develop specific drugs. On May 7, 2014, the Company changed its name from Rango Energy, Inc. to Verde Science, Inc.   GOING CONCERN - The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company suffered reoccurring net losses from operations and has a net capital deficiency, which raises substantial doubt about its ability to continue as a going concern. The financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that may result should the Company be unable to continue as a going concern.   As shown in the accompanying financial statements, the Company has incurred an accumulated deficit of $7,537,045 as of September 30, 2015. The future of the Company is dependent upon its ability to obtain financing and upon future profitable operations from the development of acquisitions. Management has plans to seek additional capital through a private placement and public offering of its common stock. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts of and classification of liabilities that might be necessary in the event the Company cannot continue in existence.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	9 Months Ended
	Sep. 30, 2015
Notes to Financial Statements
NOTE - 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	BASIS OF PRESENTATION These financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States, and are expressed in U.S. dollars. The Company's fiscal year end is December 31.   USE OF ESTIMATES The preparation of financial statements in accordance with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of net revenue and expenses in the reporting period. We regularly evaluate our estimates and assumptions related to the useful life and recoverability of long lived assets, stock based compensation and deferred income tax asset valuation allowances. We base our estimates and assumptions on current facts, historical experience and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by us may differ materially and adversely from our estimates. To the extent there are material differences between our estimates and the actual results, our future results of operations will be affected.   CASH AND CASH EQUIVALENTS The Company considers all highly liquid instruments with original maturities of three months or less when acquired, to be cash equivalents. We had no cash equivalents at September 30, 2015 or December 31, 2014, respectively.   INCOME TAXES Potential benefits of income tax losses are not recognized in the accounts until realization is more likely than not. The Company has adopted ASC 740, Income Taxes, as of its inception. Pursuant to ASC 740, the Company is required to compute tax asset benefits for net operating losses carried forward. The potential benefits of net operating losses have not been recognized in these financial statements because the Company cannot be assured it is more likely than not it will utilize the net operating losses carried forward in future years.   COMPREHENSIVE LOSS ASC 220, Comprehensive Income, establishes standards for the reporting and display of comprehensive loss and its components in the financial statements. As of September 30, 2015 and December 31, 2014, the Company has no items that represent comprehensive loss and, therefore, has not included a schedule of comprehensive loss in the financial statements.     STOCK BASED COMPENSATION ASC 718, Stock-based compensation, establishes standards for the reporting and display of stock based compensation in the financial statements.   LOSS PER COMMON SHARE The Company computes net loss per share in accordance with ASC 260, Earnings Per Share, which requires presentation of both basic and diluted earnings per share (EPS) on the face of the income statement. Basic EPS is computed by dividing net loss available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing Diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is antidilutive.   FAIR VALUE OF FINANCIAL INSTRUMENTS ASC 820, "Fair Value Measurements" and ASC 825, Financial Instruments, requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. It establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument's categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. It prioritizes the inputs into three levels that may be used to measure fair value:   Level 1   Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.   Level 2   Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.   Level 3   Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.   The following schedule summarizes the valuation of financial instruments at fair value on a recurring basis in the balance sheets as of September 30, 2015 and December 31, 2014:       Level 1     Level 2     Level 3   Derivative Liability                   September 30, 2015   $ –     $ –     $ 372,472   December 31, 2014   $ –     $ –     $ –     There were no transfers of financial assets or liabilities between Level 1 and Level 2 inputs for the nine months ended September 30, 2015 and the year ended December 31, 2014.    RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS   In June 2014, the FASB issued an accounting standard which provides new guidance that requires share-based compensation to meet a specific performance target to be achieved in order for employees to become eligible to vest in the awards and that could be achieved after an employee completes the requisite service period be treated as a performance condition. As such, the performance target should not be reflected in estimating the grant date fair value of the award. Compensation costs should be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable to the period(s) for which the requisite service has already been rendered. If the performance target becomes probable of being achieved before the end of the requisite service period, the remaining unrecognized compensation cost should be recognized prospectively over the remaining requisite service period. The total amount of compensation cost recognized during and after the requisite service period should reflect the number of awards that are expected to vest and should be adjusted to reflect those awards that ultimately vest. The requisite service period ends when the employee can cease rendering service and still be eligible to vest in the award if the performance target is achieved. This new guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2015. Early adoption is permitted. Entities may apply the amendments in this Update either (a) prospectively to all awards granted or modified after the effective date or (b) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. The adoption of ASU 201412 is not expected to have a material impact on our financial position or results of operations.    In August 2014, the FASB issued an accounting standard that requires management to assess an entity's ability to continue as a going concern by incorporating and expanding upon certain principles that are currently in U.S. auditing standards. Specifically, the standard (1) provide a definition of the term substantial doubt, (2) require an evaluation every reporting period including interim periods, (3) provide principles for considering the mitigating effect of management's plans, (4) require certain disclosures when substantial doubt is alleviated as a result of consideration of management's plans, (5) require an express statement and other disclosures when substantial doubt is not alleviated, and (6) require an assessment for a period of one year after the date that the financial statements are issued (or available to be issued). The standard in this Update is effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The adoption of ASU 201415 is not expected to have a material impact on our financial position or results of operations.   In November 2014, the FASB issued new guidance for determining when separation of certain embedded derivative features in a hybrid financial instrument is required. That is, an entity will continue to evaluate whether the economic characteristics and risks of the embedded derivative feature are clearly and closely related to those of the host contract, among other relevant criteria. The amendments clarify how current GAAP should be interpreted in evaluating the economic characteristics and risks of a host contract in a hybrid financial instrument that is issued in the form of a share. The effects of initially adopting the amendments in this Update should be applied on a modified retrospective basis to existing hybrid financial instruments issued in the form of a share as of the beginning of the fiscal year for which the amendments are effective. Retrospective application is permitted to all relevant prior periods. The adoption of ASU 201416 is not expected to have a material impact on our financial position or results of operations.   In November 2014, the FASB issued guidance to provide an acquired entity with an option to apply pushdown accounting in its separate financial statements upon occurrence of an event in which an acquirer obtains control of the acquired entity. After the effective date, an acquired entity can make an election to apply the guidance to future change-in-control events or to its most recent change-in-control event. However, if the financial statements for the period in which the most recent change-in-control event occurred already have been issued or made available to be issued, the application of this guidance would be a change in accounting principle. The amendments in this Update are effective on November 18, 2014. The adoption of ASU 201417 is not expected to have a material impact on our financial position or results of operations.   During the second quarter of 2015, the Company adopted guidance codified in ASU 2015-03, Interest - Imputation of Interest (Subtopic 835-30), Simplifying the Presentation of Debt Issuance Costs. The guidance simplifies the presentation of debt issuance costs by requiring debt issuance costs to be presented as a deduction from the corresponding liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs is not affected. Therefore, these costs will continue to be amortized as interest expense using the effective interest method pursuant to ASC 835-30-35-2 through 35-3. The Company elected to early adopt the requirements of ASU 2015-03 effective during the second quarter ended June 30, 2015 and applied this guidance retrospectively to all prior periods presented in the Company's financial statements. The reclassification does not impact net income (loss) as previously reported or any prior amounts reported on the Consolidated Balance Sheets, Consolidated Statements of Comprehensive Income (Loss) or the Consolidated Statements of Cash Flows.

DISCONTINUED OPERATIONS	9 Months Ended
	Sep. 30, 2015
Notes to Financial Statements
NOTE - 3 DISCONTINUED OPERATIONS	The Company discontinued its activities in the oil and gas industry and is focusing its activities on the marijuana consulting industry. In discontinuing its oil and gas operations, the Company incurred a $465,000 loss on discontinued operations during the nine months ended September 30, 2014. Historically the carrying value of the oil and gas properties that the Company owned were expensed in accordance with Generally Accepted Accounting Principles for the industry. The Company does not have proven reserves confirmed with a geological study and will only be able to capitalize properties once reserves have been proven. The following is a summary of the properties which the Company discontinued.   Innex Drilling and Participation Agreement   On December 16, 2013, the Company entered into a Participation Agreement with Innex California Inc. and General Crude Oil Company (together referred to as "Innex JV") for the following projects (1) The Kettleman Dome Project ("KDEP"); (2) the Kettlemen Middle Dome McAdams ("KMDM"), (3) East Elk Hills ("EEH"), (4) South Tapo Canyon ("STC"); (5) Eel River; (6) the Oklahoma ("OK"), (7) the Kettledome Middledome Shallow ("KMDS" and (8) the West Side Joint Venture ("USJV") . Under the terms of this Innex JV, the Company has the right to earn a 50% working interest in each well in which the Company funds. In order to maintain Innex JV, the Company must fund one well in each of the aforementioned projects or risk losing the right to fund. The Company must also fund Innex JV general and administrative costs of $40,000 per month.   The first quarter budget was approximately $5.77 million. The budget was delivered to the Company on March 1, 2014. Under the terms of the Innex JV, the Company was to fund the Innex JV the budget requirements by March 15, 2014. During the quarter the Company made lease payments totaling $465,000 to the Innex JV. However, the Company could not meet the terms of the budget requirement and on April 1, 2014, the Company announced that it was divesting itself of the Innex JV.

RELATED PARTY TRANSACTIONS	9 Months Ended
	Sep. 30, 2015
Notes to Financial Statements
NOTE - 4 RELATED PARTY TRANSACTIONS	The related party accounts payable to shareholders are $211,311 and $230,701 as of September 30, 2015 and December 31, 2014, respectively for accrued salary.   On July 1, 2014, the Company entered into an agreement with a related party to convert $226,785 advances to a convertible promissory note. The note is due on January 1, 2015 and carries a fixed convertible price of $0.01 and interest rate of 5%. On the same date, the related party assigned $186,000 of the principal to 23 third parties. As a result of the fixed conversion price, the Company recognized and expensed a discount of $226,785 as of December 31, 2014. On February 15, 2015, $226,000 of this convertible promissory note was converted into 22,600,000 shares; due to conversion within the terms of the agreement, no loss or gain was recognized. As of September 30, 2015, the balance of the note is $785 and accrued interest is $6,342.   During 2008, a former related party incurred $4,157 of expenses on behalf of the Company. There are no repayment terms or interest. As of September 30, 2015, the Company imputed interest at 15% resulting in an interest expense of $467.   During 2010, the Company advanced from a related party $815 for expenses. There are no repayment terms or interest. As of September 30, 2015, the Company imputed interest at 15% resulting in an interest expense of $93.   During 2011, the Company's past president advanced the Company $2,500. There are no repayment terms or interest. As of September 30, 2015, the Company imputed interest at 15% resulting in an interest expense of $281.   During 2013, the Company advanced from a related party $1,445 for expenses. There are no repayment terms or interest. During 2014, the Company repaid back $910 leaving a remaining balance of $535 as of September 30, 2015. The Company imputed interest at 15% resulting in an interest expense of $60.   At September 30, 2015, the CEO of the Company was owed $21,149 ($24,206 as at December 31, 2014) from the Company relating to advances for reimbursement of expenses. There are no repayment terms or interest. The Company imputed interest at 15% resulting in an interest expense of $2,984.

CONVERTIBLE PROMISSORY NOTE	9 Months Ended
	Sep. 30, 2015
Notes to Financial Statements
NOTE - 5 CONVERTIBLE PROMISSORY NOTE	a) On July 1, 2014, the Company entered into a $226,785 5% Convertible Note with a related party. Under the terms of the Convertible Note, all principal and interest is due on January 1, 2015. The Convertible Note is convertible at any time at the related party's option into shares of the Company's common stock at a fixed conversion price of $0.01. As a result of the fixed conversion price, the Company recognized and expensed a discount of $226,785. As at September 30, 2015, the Company has converted $226,000 of principal into 22,600,000 shares of common stock. Due to conversion within the term of the note, no gain or loss was recognized. As of September 30, 2015 the Company has recorded interest of $6,342.         b) On June 3, 2015, the Company entered into a $95,000 8% Convertible Note with a non-related third party. Under the terms of the note, the Company received $47,500 principal upon closing of the note and the Company was to receive the remaining principal in one or more installments with a Maturity Date of June 1, 2016. The Convertible Note is convertible at any time at the third party's option into shares of the Company's common stock at a variable conversion price of 60% of the lowest traded price during the 20 days prior to the notice of conversion, subject to adjustment as described in the convertible debenture. According to the terms of the Convertible Note agreement, the Company may request, after eight months from the original issuance date, the remaining $47,500. If the Company's common stock has a closing bid price of less than $0.10 per share for at least 5 consecutive trading days or the aggregate dollar trading volume of the Company's common stock is less than $40,000 in any 5 consecutive trading days, then the issuer can cancel the remaining portion of the note. Subsequent to the issuance of this note, the aggregate dollar trading volume of the Company's common stock fell below $40,000 for a 5 consecutive trading day period. As at September 30, 2015, the Company has received proceeds of $45,000, net of financing costs of $2,500 which has been recorded as a discount, and has recorded interest of $1,256.           The embedded conversion option qualifies for derivative accounting and bifurcation under ASC 815-15 Derivatives and Hedging. The initial fair value of the conversion feature of $57,838 resulted in an additional discount to the note payable of $45,000 and the remaining $12,838 was recognized as a loss on changes in fair value of derivative liability. During the nine months ended September 30, 2015, the Company recorded accretion of $7,515 increasing the carrying value of the note to $7,515.         c) On June 4, 2015, the Company entered into a $75,000 10% Convertible Note with a non-related third party. Under the terms of the Convertible Note, all principal and interest is due on June 4, 2016. The convertible note is convertible at any time at the third party's option into shares of the Company's common stock at the lesser of: (1) the closing price of the Company's common stock immediately prior to the closing date; or (2) a variable conversion price of 55% of the lowest traded price during the 25 days prior to the notice of conversion, subject to adjustment as described in the convertible debenture. As at September 30, 2015, the Company has received proceeds of $66,250, net of a discount of $8,750, and has recorded interest of $2,418. The Company incurred additional financing costs of $6,000 which has been recorded as a discount.           The embedded conversion option qualifies for derivative accounting and bifurcation under ASC 815-15 Derivatives and Hedging. The initial fair value of the conversion feature of $108,722 resulted in an additional discount to the note payable of $60,250 and the remaining $48,472 was recognized as a loss on changes in fair value of derivative liability. During the nine months ended September 30, 2015, the Company recorded accretion of $16,364 increasing the carrying value of the note to $16,364.         d) On June 10, 2015, the Company entered into a $258,000 10% Convertible Note with a non-related third party. Under the terms of the Convertible Note, the Company received $93,000 principal upon closing of the note and the Company was to receive the remaining principal in one or more installments with a Maturity Date of June 1, 2016. The convertible note is convertible at any time at the third party's option into shares of the Company's common stock at $0.50, subject to adjustment as described in the convertible note. As at September 30, 2015, the Company has received proceeds of $80,000, net of a discount of $8,000 and financing costs of $5,000 which has been recorded as a discount, and has recorded interest of $4,867. The Company incurred additional financing costs of $8,000 which has been recorded as a discount.    In addition, the Company will grant 4 warrants to purchase shares of common stock. The number of shares the warrant is exercisable into is equal to the following:       1. $46,500 divided by the Market Price on the issuance date.(issuable)             2. $27,500 divided by the Market Price on the issuance date.             3. $27,500 divided by the Market Price on the issuance date.             4. $27,500 divided by the Market Price on the issuance date.   As at September 30, 2015, the company has not issued warrants pursuant to the convertible note. The warrants are exercisable at $0.50 per share.   The first tranche of warrants issuable and the embedded conversion option qualify for derivative accounting and bifurcation under ASC 815-15 Derivatives and Hedging. The initial fair value of the conversion feature of $103,533 for the convertible note and $68,606 for the warrants resulted in an additional discount to the note payable of $72,000 and the remaining $100,139 was recognized as a loss on changes in fair value of derivative liability. During the nine months ended September 30, 2015, the Company recorded accretion of $12,018 increasing the carrying value of the note to $12,018.     e) On June 11, 2015, the Company entered into a $66,250 10% Convertible Note with a non-related third party. Under the terms of the Convertible Note, all principal and interest is due on March 11, 2016. The convertible note is convertible at any time at the third party's option into shares of the Company's common stock at the lesser of: (1) a variable conversion price of 55% of the lowest traded price during the 25 days prior to the issuance of the note; or (2) a variable conversion price of 55% of the lowest traded price during the 25 days prior to the notice of conversion, subject to adjustment as described in the convertible note. As at September 30, 2015, the Company has received proceeds of $60,000, net of a discount of $3,500, financing costs of $2,750 which has been recorded as a discount and has recorded interest of $2,684. The Company incurred additional financing costs of $10,500 which has been recorded as a discount.           The embedded conversion option qualifies for derivative accounting and bifurcation under ASC 815-15 Derivatives and Hedging. The initial fair value of the conversion feature of $93,623 resulted in an additional discount to the note payable of $49,500 and the remaining $44,123 was recognized as a loss on changes in fair value of derivative liability. During the nine months ended September 30, 2015, the Company recorded accretion of $9,746 increasing the carrying value of the note to $9,746.

DERIVATIVE LIABILITIES	9 Months Ended
	Sep. 30, 2015
Notes to Financial Statements
NOTE - 6 DERIVATIVE LIABILITIES	The embedded conversion options of the Company's convertible debentures described in Note 5 contain conversion features that qualify for embedded derivative classification. The fair value of these liabilities will be re-measured at the end of every reporting period and the change in fair value will be reported in the statement of operations as a gain or loss on derivative liabilities.   The table below sets forth a summary of changes in the fair value of the Company's Level 3 financial liabilities:       For the Nine Months Ended September 30, 2015           Balance at the beginning of period   $ –             Fair value of new derivative liabilities (embedded conversion option)     432,322   Change in fair value of derivative     (59,850 )           Balance at end of period   $ 372,472     The derivative instruments were valued at loan origination date and at September 30, 2015, The fair values of the derivative liabilities related to the conversion options of these notes was estimated on the transaction dates using the Multinomial Lattice option pricing model.: The model incorporates the price of a share of the Company's common stock (as quoted on the Over the Counter Bulletin Board), volatility, risk free rate, dividend rate and estimated life. Significant changes in any of these inputs in isolation would result in a significant change in the fair value measurement. The following table shows the assumptions used in the calculations:       Expected Volatility     Risk-Free Interest Rate   Expected Dividend Yield     Expected Life (in years)                           At Issuance   264% - 270 %    0.08% - 0.28 %   0 %   0.75 - 1.08   At September 30, 2015     305 %   0.00% - 0.08 %    0 %   0.45 - 0.78

STOCKHOLDERS' EQUITY	9 Months Ended
	Sep. 30, 2015
Notes to Financial Statements
NOTE - 7 STOCKHOLDERS' EQUITY	On January 17, 2014 the Company entered into a Private Placement Agreement to issue up to 35,714 shares of Common Stock at $22.40 per share. The Company has received $468,200 by way of subscription agreements. The 20,902 shares were issued on May 23, 2014.   On February 28, 2014 the Company issued 3,571 warrants to a consultant. The warrants have an exercise price of $11.20 per share and have a life of ten years. The warrants were fully vested and expensed on the date of grant. The Company valued these warrants using the Black-Scholes option pricing model totaling $104,997 under the following assumptions: $30.80 stock price, 10 years to maturity, 365% volatility, 1.51% risk free rate. During the same period, the consultant exercised on a cashless basis and received 3,571 shares of common stock.   On February 28, 2014 the Company issued 8,036 warrants to a consultant. The warrants have an exercise price of $11.20 per share and have a life of ten years. The warrants were fully vested and expensed on the date of grant. The Company valued these warrants using the Black-Scholes option pricing model totaling $241,869 under the following assumptions: $30.80 stock price, 10 years to maturity, 365% volatility, 1.51% risk free rate. During the same period, the consultant exercised on a cashless basis and received 8,036 shares of common stock.    On February 28, 2014 the Company issued 893 warrants to a consultant. The warrants have an exercise price of $11.20 per share and have a life of ten years. The warrants were fully vested and expensed on the date of grant. The Company valued these warrants using the Black-Scholes option pricing model totaling $26,874 under the following assumptions: $30.80 stock price, 10 years to maturity, 365% volatility, 1.51% risk free rate. During the same period, the consultant exercised on a cashless basis and received 893 shares of common stock.   On April 1, 2014 the Company issued 1,250 shares as settlement for services provided. Given the market price of $28.00 as April 1, 2014, the Company valued the shares at $35,000 based on fair market value of the closing price on the date of grant. Due to the shares being issued the Company has expensed this value.   On April 17, 2014, the Company extended an Investor Relations Consulting Agreement with San Diego Torrey Hills Capital, Inc. for an additional nine months. The Company has issued 2,679 shares. Given the market price of $22.40 as April 17, 2014, the Company has valued the shares at $60,000 based on fair market value of the closing price on the date of grant. Due to the shares being issued the Company has expensed this value.   On April 17, 2014 the Company issued 6,786 warrants to a consultant. The warrants have an exercise price of $11.20 per share and have a life of ten years. The warrants were fully vested and expensed on the date of grant. The Company valued these warrants using the Black-Scholes option pricing model totaling $151,965 under the following assumptions: $22.40 stock price, 10 years to maturity, 320% volatility, 1.75% risk free rate. During the same period, the consultant exercised on a cashless basis and received 6,786 shares of common stock.   On April 17, 2014 the Company issued 7,857 warrants to a consultant. The warrants have an exercise price of $11.20 per share and have a life of ten years. The warrants were fully vested and expensed on the date of grant. The Company valued these warrants using the Black-Scholes option pricing model totaling $175,960 under the following assumptions: $22.40 stock price, 10 years to maturity, 320% volatility, 1.75% risk free rate. During the same period, the consultant exercised on a cashless basis and received 7,857 shares of common stock.   On June 9, 2014 the Company issued 4,464 shares as settlement for services provided. Given the market price of $19.60 as June 9, 2014, the Company valued the shares at $87,500 based on fair market value of the closing price on the date of grant. Due to the shares being issued the Company has expensed this value.   On June 15, 2014 the Company issued 1,063 shares as settlement for services provided. Given the market price of $13.99 as June 15, 2014, the Company valued the shares at $14,875 based on fair market value of the closing price on the date of grant. Due to the shares being issued the Company has expensed this value.   On June 17, 2014 the Company issued 8,036 shares as settlement for services provided. Given the market price of $14.00 as June 17, 2014, the Company valued the shares at $112,500 based on fair market value of the closing price on the date of grant. Due to the shares being issued the Company has expensed this value.   On June 20, 2014, the Company issued 17,857 warrants to a consultant. The warrants have an exercise price of $11.20 per share and have a life of ten years. The warrants were fully vested and expensed on the date of grant. The Company valued these warrants using the Black-Scholes option pricing model totaling $399,909 under the following assumptions: $11.20 stock price, 10 years to maturity, 320% volatility, 1.75% risk free rate. One consultant exercised on a cashless basis and received 17,857 shares of common stock.   On February 15, 2015, $226,000 of the $226,785 convertible promissory note was converted into 22,600,000 shares of common stock. The remaining amount of the convertible note $785 is due to Harp Sangha, president of the Company.   On May 12, 2015, the Company completed a private placement for the issuance of 800,000 shares of common stock for proceeds of $40,000.

SUBSEQUENT EVENTS	9 Months Ended
	Sep. 30, 2015
Notes to Financial Statements
NOTE - 8 SUBSEQUENT EVENTS	In accordance with ASC 855-10, management has reviewed all material events through the date of this report and has determined there are no material subsequent events to disclose.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	9 Months Ended
	Sep. 30, 2015
Summary Of Significant Accounting Policies Policies
BASIS OF PRESENTATION	These financial statements and related notes are presented in accordance with accounting principles generally accepted in the United States, and are expressed in U.S. dollars. The Company's fiscal year end is December 31.
USE OF ESTIMATES	The preparation of financial statements in accordance with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of net revenue and expenses in the reporting period. We regularly evaluate our estimates and assumptions related to the useful life and recoverability of long lived assets, stock based compensation and deferred income tax asset valuation allowances. We base our estimates and assumptions on current facts, historical experience and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by us may differ materially and adversely from our estimates. To the extent there are material differences between our estimates and the actual results, our future results of operations will be affected.
CASH AND CASH EQUIVALENT	The Company considers all highly liquid instruments with original maturities of three months or less when acquired, to be cash equivalents. We had no cash equivalents at September 30, 2015 or December 31, 2014, respectively.
INCOME TAXES	Potential benefits of income tax losses are not recognized in the accounts until realization is more likely than not. The Company has adopted ASC 740, Income Taxes, as of its inception. Pursuant to ASC 740, the Company is required to compute tax asset benefits for net operating losses carried forward. The potential benefits of net operating losses have not been recognized in these financial statements because the Company cannot be assured it is more likely than not it will utilize the net operating losses carried forward in future years.
COMPREHENSIVE LOSS ASC 220	Comprehensive Income, establishes standards for the reporting and display of comprehensive loss and its components in the financial statements. As of September 30, 2015 and December 31, 2014, the Company has no items that represent comprehensive loss and, therefore, has not included a schedule of comprehensive loss in the financial statements.
STOCK BASED COMPENSATION ASC 718	Stock-based compensation, establishes standards for the reporting and display of stock based compensation in the financial statements.
LOSS PER COMMON SHARE	The Company computes net loss per share in accordance with ASC 260, Earnings Per Share, which requires presentation of both basic and diluted earnings per share (EPS) on the face of the income statement. Basic EPS is computed by dividing net loss available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing Diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is antidilutive.
FAIR VALUE OF FINANCIAL INSTRUMENTS ASC 820	Financial Instruments, requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. It establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument's categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. It prioritizes the inputs into three levels that may be used to measure fair value:   Level 1   Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.   Level 2   Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.   Level 3   Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.   The following schedule summarizes the valuation of financial instruments at fair value on a recurring basis in the balance sheets as of September 30, 2015 and December 31, 2014:       Level 1     Level 2     Level 3   Derivative Liability                   September 30, 2015   $ –     $ –     $ 372,472   December 31, 2014   $ –     $ –     $ –     There were no transfers of financial assets or liabilities between Level 1 and Level 2 inputs for the nine months ended September 30, 2015 and the year ended December 31, 2014.
RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS	In June 2014, the FASB issued an accounting standard which provides new guidance that requires share-based compensation to meet a specific performance target to be achieved in order for employees to become eligible to vest in the awards and that could be achieved after an employee completes the requisite service period be treated as a performance condition. As such, the performance target should not be reflected in estimating the grant date fair value of the award. Compensation costs should be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable to the period(s) for which the requisite service has already been rendered. If the performance target becomes probable of being achieved before the end of the requisite service period, the remaining unrecognized compensation cost should be recognized prospectively over the remaining requisite service period. The total amount of compensation cost recognized during and after the requisite service period should reflect the number of awards that are expected to vest and should be adjusted to reflect those awards that ultimately vest. The requisite service period ends when the employee can cease rendering service and still be eligible to vest in the award if the performance target is achieved. This new guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2015. Early adoption is permitted. Entities may apply the amendments in this Update either (a) prospectively to all awards granted or modified after the effective date or (b) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. The adoption of ASU 201412 is not expected to have a material impact on our financial position or results of operations.    In August 2014, the FASB issued an accounting standard that requires management to assess an entity's ability to continue as a going concern by incorporating and expanding upon certain principles that are currently in U.S. auditing standards. Specifically, the standard (1) provide a definition of the term substantial doubt, (2) require an evaluation every reporting period including interim periods, (3) provide principles for considering the mitigating effect of management's plans, (4) require certain disclosures when substantial doubt is alleviated as a result of consideration of management's plans, (5) require an express statement and other disclosures when substantial doubt is not alleviated, and (6) require an assessment for a period of one year after the date that the financial statements are issued (or available to be issued). The standard in this Update is effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The adoption of ASU 201415 is not expected to have a material impact on our financial position or results of operations.   In November 2014, the FASB issued new guidance for determining when separation of certain embedded derivative features in a hybrid financial instrument is required. That is, an entity will continue to evaluate whether the economic characteristics and risks of the embedded derivative feature are clearly and closely related to those of the host contract, among other relevant criteria. The amendments clarify how current GAAP should be interpreted in evaluating the economic characteristics and risks of a host contract in a hybrid financial instrument that is issued in the form of a share. The effects of initially adopting the amendments in this Update should be applied on a modified retrospective basis to existing hybrid financial instruments issued in the form of a share as of the beginning of the fiscal year for which the amendments are effective. Retrospective application is permitted to all relevant prior periods. The adoption of ASU 201416 is not expected to have a material impact on our financial position or results of operations.   In November 2014, the FASB issued guidance to provide an acquired entity with an option to apply pushdown accounting in its separate financial statements upon occurrence of an event in which an acquirer obtains control of the acquired entity. After the effective date, an acquired entity can make an election to apply the guidance to future change-in-control events or to its most recent change-in-control event. However, if the financial statements for the period in which the most recent change-in-control event occurred already have been issued or made available to be issued, the application of this guidance would be a change in accounting principle. The amendments in this Update are effective on November 18, 2014. The adoption of ASU 201417 is not expected to have a material impact on our financial position or results of operations.   During the second quarter of 2015, the Company adopted guidance codified in ASU 2015-03, Interest - Imputation of Interest (Subtopic 835-30), Simplifying the Presentation of Debt Issuance Costs. The guidance simplifies the presentation of debt issuance costs by requiring debt issuance costs to be presented as a deduction from the corresponding liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs is not affected. Therefore, these costs will continue to be amortized as interest expense using the effective interest method pursuant to ASC 835-30-35-2 through 35-3. The Company elected to early adopt the requirements of ASU 2015-03 effective during the second quarter ended June 30, 2015 and applied this guidance retrospectively to all prior periods presented in the Company's financial statements. The reclassification does not impact net income (loss) as previously reported or any prior amounts reported on the Consolidated Balance Sheets, Consolidated Statements of Comprehensive Income (Loss) or the Consolidated Statements of Cash Flows.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)	9 Months Ended
	Sep. 30, 2015
Summary Of Significant Accounting Policies Tables
Schedule of Financial Instruments at Fair Value	Level 1     Level 2     Level 3   Derivative Liability                   September 30, 2015   $ –     $ –     $ 372,472   December 31, 2014   $ –     $ –     $ –

DERIVATIVE LIABILITIES (Tables)	9 Months Ended
	Sep. 30, 2015
Derivative Liabilities Tables
Summary of changes in the fair value of the Company's Level	For the Nine Months Ended September 30, 2015           Balance at the beginning of period   $ –             Fair value of new derivative liabilities (embedded conversion option)     432,322   Change in fair value of derivative     (59,850 )           Balance at end of period   $ 372,472
Fair value measurement	Expected Volatility     Risk-Free Interest Rate   Expected Dividend Yield     Expected Life (in years)                           At Issuance   264% - 270 %    0.08% - 0.28 %   0 %   0.75 - 1.08   At September 30, 2015     305 %   0.00% - 0.08 %    0 %   0.45 - 0.78

NATURE OF OPERATIONS (Details Narrative) - USD ($)	Sep. 30, 2015	Dec. 31, 2014
Nature Of Operations Details Narrative
Accumulated deficit	$ (7,537,045)	$ (7,015,883)

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($)	Sep. 30, 2015	Dec. 31, 2014
Fair Value, Inputs, Level 1 [Member]
Liabilities
Fair Value, Inputs, Level 2 [Member]
Liabilities
Fair Value, Inputs, Level 3 [Member]
Liabilities	$ 372,472

RELATED PARTY (Details Narrative) - USD ($)	9 Months Ended
	Sep. 30, 2015	Dec. 31, 2014
Related party accounts payable	$ 211,311	$ 230,701
Related party convertible notes payable	785	226,785
Accrued interest	6,342
Interest balance	535
Expenses related	$ 21,149	$ 24,206
2008
Company imputed interest	15.00%
Interest expense	$ 467
2010
Company imputed interest	15.00%
Interest expense	$ 93
2011
Company imputed interest	15.00%
Interest expense	$ 281
2014
Company imputed interest	15.00%
Interest expense	$ 60
Chief Executive Officer [Member]
Company imputed interest	15.00%
Owed to CEO for reimbursement of expenses	$ 2,984

CONVERTIBLE PROMISSORY NOTE (Details Narrative)	9 Months Ended
	Sep. 30, 2015 USD ($) $ / shares shares
Common Stock, Amount	$ 226,000
Common Stock, Shares | shares	22,600,000
On July 1, 2014 [Member]
Accrued interest	$ 6,342
On June 3, 2015 [Member]
Accrued interest	1,256
Proceeds from note payable	45,000
Debt discount	2,500
Accretion of discount	7,515
Carrying value	7,515
On June 4, 2015 [Member]
Accrued interest	2,418
Proceeds from note payable	66,250
Debt discount	8,750
Accretion of discount	16,364
Carrying value	16,364
On June 10, 2015 [Member]
Accrued interest	4,867
Proceeds from note payable	80,000
Debt discount	8,000
Accretion of discount	12,018
Carrying value	12,018
Financing costs	$ 5,000
Exercisable warrant per share | $ / shares	$ 0.50
On June 11, 2015 [Member]
Accrued interest	$ 2,684
Proceeds from note payable	60,000
Debt discount	3,500
Accretion of discount	9,746
Carrying value	9,746
Financing costs	$ 2,750

DERIVATIVE LIABILITIES (Details)	9 Months Ended
	Sep. 30, 2015 USD ($)
Derivative Liabilities Details
Balance at the beginning of period
Fair value of new derivative liabilities (embedded conversion option)	$ 432,322
Change in fair value of derivative	(59,850)
Balance at end of period	$ 372,472

DERIVATIVE LIABILITIES (Details 1)	9 Months Ended
	Sep. 30, 2015
Expected Volatility	305.00%
Expected Dividend Yield	0.00%
Minimum
Risk- Free Interest Rate	0.00%
Expected Life (in years)	5 months 12 days
Maximum
Risk- Free Interest Rate	0.08%
Expected Life (in years)	9 months 11 days
Issuance
Expected Dividend Yield	0.00%
Issuance | Minimum
Expected Volatility	264.00%
Risk- Free Interest Rate	0.08%
Expected Life (in years)	9 months
Issuance | Maximum
Expected Volatility	270.00%
Risk- Free Interest Rate	0.28%
Expected Life (in years)	1 year 29 days