| Schedule of Liabilities Measured at Fair Value |
The following two tables
set forth the Company’s consolidated financial assets and liabilities measured at fair value by level within the fair value
hierarchy at December 31, 2016 and 2015. Assets and liabilities are classified in their entirety based on the lowest level of input
that is significant to the fair value measurement.
| |
|
Fair value at |
|
|
|
|
|
|
|
|
|
|
| |
|
December 31, 2016 |
|
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
| Preferred stock embedded conversion feature |
|
$ |
123,266 |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
123,266 |
|
| Anti-dilution provision in common stock warrants included with preferred stock |
|
|
52,904 |
|
|
|
- |
|
|
|
- |
|
|
|
52,904 |
|
| Debenture embedded conversion feature |
|
|
25,884 |
|
|
|
- |
|
|
|
- |
|
|
|
25,884 |
|
| Anti-dilution provision in common stock warrants included with debentures |
|
|
10,988 |
|
|
|
- |
|
|
|
- |
|
|
|
10,988 |
|
| Total derivatives |
|
$ |
213,042 |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
213,042 |
|
| |
|
Fair value at |
|
|
|
|
|
|
|
|
|
|
| |
|
December 31, 2015 |
|
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
| Preferred stock embedded conversion feature |
|
$ |
376,065 |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
376,065 |
|
| Anti-dilution provision in common stock warrants included with preferred stock |
|
|
51,203 |
|
|
|
- |
|
|
|
- |
|
|
|
51,203 |
|
| Debenture embedded conversion feature |
|
|
560,778 |
|
|
|
- |
|
|
|
- |
|
|
|
560,778 |
|
| Anti-dilution provision in common stock warrants included with debentures |
|
|
79,943 |
|
|
|
- |
|
|
|
- |
|
|
|
79,943 |
|
| Total derivatives |
|
$ |
1,067,989 |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
1,067,989 |
|
|
| Schedule of Reconciliation of Level 3 Conversion Option Liability |
The following tables present
a reconciliation of the beginning and ending balances of items measured at fair value on a recurring basis that use significant
unobservable inputs (Level 3) and the related realized and unrealized (gains) losses recorded in the consolidated statements of
operations during the period:
| |
Year Ended December 31, 2016 |
| |
|
Preferred stock embedded conversion feature |
|
|
Anti-dilution provision in common stock warrants included with preferred stock |
|
|
Debenture embedded conversion feature |
|
|
Anti-dilution provision in common stock warrants included with debentures |
|
|
Total |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Fair value, December 31, 2015 |
|
$ |
376,065 |
|
|
$ |
51,203 |
|
|
$ |
560,778 |
|
|
$ |
79,943 |
|
|
$ |
1,067,989 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net unrealized gain on derivatives |
|
|
(277,337 |
) |
|
|
(52,800 |
) |
|
|
(408,919 |
) |
|
|
(68,955 |
) |
|
|
(808,011 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Purchases and issuances (sales and settlements) |
|
|
24,538 |
|
|
|
54,501 |
|
|
|
(125,975 |
) |
|
|
— |
|
|
|
(46,936 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Fair value, December 31, 2016 |
|
$ |
123,266 |
|
|
$ |
52,904 |
|
|
$ |
25,884 |
|
|
$ |
10,988 |
|
|
$ |
213,042 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Changes in unrealized gains, included in income on instruments held at end of year |
|
$ |
(277,337 |
) |
|
$ |
(52,800 |
) |
|
$ |
(408,919 |
) |
|
$ |
(68,955 |
) |
|
$ |
(808,011 |
) |
| |
|
Year Ended December 31, 2015 |
|
| |
|
Preferred stock embedded conversion feature |
|
|
Anti-dilution provision in common stock warrants included with preferred stock |
|
|
Debenture embedded conversion feature |
|
|
Anti-dilution provision in common stock warrants included with debentures |
|
|
Total |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Fair value, December 31, 2014 |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
|
|
|
|
$ |
— |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net unrealized (gains)/loss on derivatives |
|
|
205,509 |
|
|
|
23,503 |
|
|
|
(85,319 |
) |
|
|
(12,163 |
) |
|
|
131,530 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Purchases and issuances (sales and settlements) |
|
|
170,556 |
|
|
|
27,700 |
|
|
|
646,097 |
|
|
|
92,106 |
|
|
|
936,459 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Fair value, December 31, 2015 |
|
$ |
376,065 |
|
|
$ |
51,203 |
|
|
$ |
560,778 |
|
|
$ |
79,943 |
|
|
$ |
1,067,989 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Changes in unrealized (gains)/losses, included in income on instruments held at end of year |
|
$ |
205,509 |
|
|
$ |
23,503 |
|
|
$ |
(85,319 |
) |
|
$ |
(12,163 |
) |
|
$ |
131,530 |
|
|