Quarterly report pursuant to Section 13 or 15(d)

FAIR VALUE MEASUREMENT (Tables)

FAIR VALUE MEASUREMENT (Tables)

3 Months Ended

Mar. 31, 2015

Schedule of Derivative Liabilities at Fair Value

Items recorded or measured at fair value on a recurring basis in the accompanying consolidated financial statements consisted of the following items as of March 31, 2015:

	Level 1		Level 2		Level 3		Total
Debt derivative liability	$	-	$	-	$	194,358		194,358
Warrant liability	$		$	-	$	121,354		121,354
Total	$	-	$	-	$	315,712	$	315,712

Items recorded or measured at fair value on a recurring basis in the accompanying consolidated financial statements consisted of the following items as of December 31, 2014:

	Level 1		Level 2		Level 3		Total
Warrant liability	$	-	$	-	$	98,702	$	98,702
Total	$	-	$	-	$	98,702	$	98,702

Changes in the fair value of the Company's Level 3 financial liabilities

	Debt Derivative Liability			Warrant Liability
Balance, December 31, 2013	$	1,019,103			287,731
Transfers in (out):
Fair value of debt derivative at note extinguishment transferred to equity		(800,987	)
Fair value of warrant liability at date of cancellation transferred to equity					(129,551	)
Mark-to-market at December 31, 2014:
Embedded derivative		(218,116	)		(59,478	)
Balance, December 31, 2014		-			98,702
Transfers in (out):
Initial fair value of debt derivative at note issuance		121,354
Mark-to-market at March 31, 2015:
Embedded derivative		73,004			22,652
Balance, March 31, 2015	$	194,358		$	121,354