Annual report pursuant to Section 13 and 15(d)

Warrants (Tables)

Warrants (Tables)

12 Months Ended

Dec. 31, 2016

The following is a summary of the Company’s warrant activity:

	Warrants			Weighted average exercise price		Weighted average remaining contractual term in years		Aggregate intrinsic value
Outstanding January 1, 2015		28,435,782		$	0.64		4.07	$	-
Exercisable January 1, 2015		28,435,782		$	0.64		4.07	$	-
Canceled		-
Granted		18,568,180
Exercised		-
Forfeited		-
Outstanding December 31, 2015		47,003,962		$	0.46		3.49	$	2,579,541
Exercisable December 31, 2015		47,003,962		$	0.46		3.49	$	2,579,541
Canceled		-
Granted		42,037,500
Exercised		-
Forfeited		(676,426	)
Outstanding December 31, 2016		88,365,036		$	0.30		3.50	$	543,770
Exercisable December 31, 2016		88,365,036		$	0.30		3.50	$	543,770

Schedule of Fair Value Assumptions Related to Warrants Outstanding

The range of fair value assumptions related to warrants outstanding were as follows as of December 31:

	2016			2015
Dividend yield		0.0	%		0.0	%
Risk-free rate		0.12% - 0.86	%		0.12% - 0.66	%
Expected volatility		102% - 159	%		112% - 159	%
Expected term		1.0 - 2.5 years			1.0 - 2.5 years

- Definition

Tabular disclosure of warrants or rights issued. Warrants and rights outstanding are derivative securities that give the holder the right to purchase securities (usually equity) from the issuer at a specific price within a certain time frame. Warrants are often included in a new debt issue to entice investors by a higher return potential. The main difference between warrants and call options is that warrants are issued and guaranteed by the company, whereas options are exchange instruments and are not issued by the company. Also, the lifetime of a warrant is often measured in years, while the lifetime of a typical option is measured in months. Disclose the title of issue of securities called for by warrants and rights outstanding, the aggregate amount of securities called for by warrants and rights outstanding, the date from which the warrants or rights are exercisable, and the price at which the warrant or right is exercisable.

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