Quarterly report pursuant to Section 13 or 15(d)

10. DERIVATIVE FINANCIAL INSTRUMENTS

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10. DERIVATIVE FINANCIAL INSTRUMENTS
6 Months Ended
Jun. 30, 2015
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
NOTE 10. DERIVATIVE FINANCIAL INSTRUMENTS

The Company determined that certain embedded features related to the Convertible Notes and Warrant issued in connection with the Convertible Notes as discussed in Note 3 and 9 above are derivative financial instruments.

 

Fair values of derivative instruments not designated as hedging instruments consist of the following: 

           
Liability derivatives: Balance Sheet Location   Fair Value  
June 30, 2015:          
Convertible Notes Compound Derivatives Derivative liabilities   $ 252,014  
Convertible Note Warrant Liability  Warrant Liability    $ 127,395  

 

There were no derivative instruments issued or outstanding as of December 31, 2014.

 

The amount of gain or recognized for derivative instruments in the statement of operations for the three and six months ended June 30, 2015 consist of the following:  

               

Derivatives not

designated as

hedging instruments

Location of gain

            recognized in income on derivative

 

Three Months

Ended

June 30, 2015

   

Six Months

Ended

June 30, 2015

 
Convertible Notes Compound Derivatives Change in fair value of embedded derivative liabilities   $ 33,689     $ 22,317  
Convertible Note Warrant Liability  Change in fair value of warrant liability    $ 9,800     $ 19,600