RELATED PARTIES

The Company has four convertible notes payable to related parties that have a principal balance of $91,000 and $91,000 as of June 30, 2019 and December 31, 2018, respectively. These notes carry interest rates of 9% and have due dates ranging from 1/23/2014 - 4/8/2015. All four notes are currently in default and carry a default interest rate of 10%. These notes carry conversion prices ranging from $0.0072 - $0.0800 per share. The Company evaluated these convertible notes and determined that, for the embedded conversion option, there was a beneficial conversion value to record. The beneficial conversion feature was amortized over the life of the notes, one year, and was fully amortized at June 30, 2019 and December 31, 2018. No beneficial conversion feature expense was incurred during the six month period ended June 30, 2019 and 2018.

The Company has ten non-convertible notes payable to related parties that have a principal balance of $343,700 and $343,700 as of June 30, 2019 and December 31, 2018, respectively. These notes carry interest rates ranging from 0% - 10% and have due dates ranging from 8/03/2012 - 11/28/2016. Nine of the ten notes are currently in default and carry a default interest rate of 10%.

The Company has thirty notes payable with detached free-standing warrants to related parties that have a principal balance of $345,894 and $271,144 as of June 30, 2019 and December 31, 2018, respectively. These notes carry interest rates ranging from 7% - 10% and have due dates ranging from 8/05/2015 - 03/30/2020. Twenty-eight of the thirty notes, carrying a total principal balance of $336,144, are currently in default and carry a default interest rate of 10%. The exercise price for each note payable detached free-standing warrant ranges from $0.0018664652 - $0.0160. As of June 30, 2019 and December 31, 2018, these notes carried outstanding detached free-standing warrants of 40,535,165 and 23,953,003, respectively. The unamortized discount related to these warrants at June 30, 2019 and December 31, 2018 is $28,011 and $8,074, respectively. During the six month period ended June 30, 2019 and 2018, stock warrants amortization expense recorded to interest expense was $15,093 and $22,517, respectively. The reason for the decrease in stock warrants expense was directly related to the timing of funds borrowed and the related amortization of its stock warrants. The relative fair market value of stock warrants granted during the six month period ended June 30, 2019 and 2018 was $35,030 and $29,701, respectively. The fair market value of the outstanding stock warrants was calculated utilizing the Black-Sholes method using the following assumptions: risk free rates ranging between 2.31% - 2.53%, dividend yield of 0%, expected life of 5 years, volatility between 135% - 138%.

Total interest expense for related party notes was $43,235 and $39,446 for the six month period ended June 30, 2019 and 2018, respectively.

NON- RELATED PARTIES

The Company has eighteen convertible notes payable to non-related parties that have a principal balance of $203,136 and $143,136 as of June 30, 2019 and December 31, 2018, respectively. These notes carry interest rates ranging from 5% - 30% and have due dates ranging from 10/30/2012 - 5/23/2019. Sixteen of the eighteen notes, carrying a total principal balance of $143,136, are currently in default and carry a default interest rate of 10%. These notes carry conversion prices ranging from $0.0017- $0.3235688 per share. On March 1, 2019 and May 3, 2019, the Company entered into convertible note payable agreements that converts to its common stock at a variable conversion price. As further discussed in Note 5 – Derivative Liability, the Company analyzed the conversion features of the note agreement for derivative accounting consideration under ASU 2017-11 (ASC 815-15 Derivatives and Hedging), and determined the embedded conversion features should be classified as a derivative because the exercise price of the convertible note is subject to a variable conversion rate. The Company evaluated these convertible notes and determined that an embedded conversion feature was recorded. Unamortized debt discount related to these notes was $44,257 and $5,920 as of June 30, 2019 and December 31, 2018, respectively. Beneficial conversion feature expense incurred was $17,763 and none during the six month period ended June 30, 2019 and 2018, respectively.

The Company has three non-convertible notes payable to non-related parties that have a principal balance of $21,438 and $21,438 as of June 30, 2019 and December 31, 2018, respectively. These notes carry interest rates ranging from 9% - 18% and have due dates ranging from 1/31/2013 - 11/28/2015. All three notes are currently in default and carry a default interest rate of 10%.

The Company has one note payable with detached free-standing warrants to a non-related party that has a principal balance of $5,000 and $5,000 as of June 30, 2019 and December 31, 2018, respectively. This note carries an interest rate of 10% and had a due date of 9/11/2014. This note is currently in default. The exercise price for the attached warrants is $0.019 for a total amount of 50,000 common shares. At June 30, 2019 and December 31, 2018, this note carried outstanding detached free-standing warrants of none and 50,000, respectively. There was no unamortized discount related to these warrants as of June 30, 2019 and December 31, 2018, and no stock warrant amortization expense was recorded to interest expense during the six month period ended June 30, 2019 and 2018.

Total interest expense for non-related party notes was $28,762 and $24,371 for the six month period ended June 30, 2019 and 2018, respectively.