RELATED PARTIES

The Company has certain convertible notes payable to related parties that have a principal balance of $91,000 and $91,000 as of September 30, 2018 and December 31, 2017, respectively. These notes carry interest rates ranging from 7% - 9% and have due dates ranging from 1/23/2014 - 4/8/2015. All 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 September 30, 2018 and December 31, 2017. No beneficial conversion feature expense was incurred during the nine month period ended September 30, 2018 and September 30, 2017.

The Company has certain non-convertible notes payable to related parties that have a principal balance of $343,700 and $343,700 as of September 30, 2018 and December 31, 2017, respectively. These notes carry interest rates ranging from 0% - 10% and have due dates ranging from 8/03/2012 - 7/23/2016. All notes are currently in default and carry a default interest rate of 10%.

The Company has certain notes payable with detached free-standing warrants to related parties that have a principal balance of $271,144 and $215,844 as of September 30, 2018 and December 31, 2017, respectively. These notes carry interest rates ranging from 7% - 10% and have due dates ranging from 8/05/2015 - 04/17/2019. Seventeen of these notes, carrying a total principal balance of $194,600, 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 $0.0042 - $0.0160. As of September 30, 2018, and December 31, 2017, these notes carried outstanding detached free-standing warrants of 24,003,003 and 16,070,611, respectively. The unamortized discount related to these warrants at September 30, 2018 and December 31, 2017 was $16,532 and $19,969, respectively. During the nine month period ended September 30, 2018 and September 30, 2017, stock warrants amortization expense recorded to interest expense was $33,138 and $90,632, respectively. The reason for the decrease in stock warrants amortization expense was directly related to a decrease in funds borrowed. The fair market value of stock warrants granted during the nine month period ended September 30, 2018 was $29,701. The fair market value of the outstanding warrants was calculated utilizing the Black-Sholes method using the following assumptions: risk free rates ranging between 0.23% - 0.85%, dividend yield of 0%, expected life of 1 year, volatility between 141% - 375%.

Total interest expense for related party notes was $60,198 and $52,660 for the nine month period ended September 30, 2018 and September 30, 2017, respectively.

NON- RELATED PARTIES

The Company has certain convertible notes payable to non-related parties that have a principal balance of $143,136 and $137,136 as of September 30, 2018 and December 31, 2017, respectively. These notes carry interest rates ranging from 5% - 30% and have due dates ranging from 2/08/2012 - 5/23/2019. Fifteen of these notes, carrying a total principal balance of $137,136, 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. The Company evaluated these convertible notes and determined that, for the embedded conversion option, there was a beneficial conversion value to record. Unamortized beneficial conversion feature related to these notes was $1,467 and none as of September 30, 2018 and December 31, 2017, respectively. Beneficial conversion feature expense incurred was $4,533 and $21,500 during the nine month period ended September 30, 2018 and September 30, 2017, respectively.

The Company has certain non-convertible notes payable to non-related parties that have a principal balance of $21,438 and $21,438 as of September 30, 2018 and December 31, 2017, respectively. These notes carry interest rates ranging from 9% - 18% and have due dates ranging from 1/31/2013 - 11/11/2015. All notes are currently in default and carry a default interest rate of 10%.

The Company has certain notes payable with detached free-standing warrants to a non-related party that has a principal balance of $5,000 and $5,000 as of September 30, 2018 and December 31, 2017, 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 warrant is $0.019 for a total amount of 50,000 common shares. At September 30, 2018 and December 31, 2017, this note carried outstanding detached free-standing warrants of 50,000 and 50,000, respectively. There was no unamortized discount related to these warrants as of September 30, 2018 and December 31, 2017, and no stock warrants amortization expense was recorded to interest expense during the nine month period ended September 30, 2018 and September 30, 2017.

Total interest expense for non-related party notes was $37,128 and $33,934 for the nine month period ended September 30, 2018 and September 30, 2017, respectively.