Note 10 – Derivative Liabilities

Derivatives liabilities were $12,435,250 and $2,803 at December 31, 2017 and 2016, respectively. The derivative liabilities consist of the fair value of: (i) conversion option features of debentures; and (ii) the fair value of warrants. As of December 31, 2017, the Company does not have enough authorized shares of its common stock to satisfy its obligations under the terms of its debentures and warrants. Accordingly, the Company recorded the fair value of the conversion option features of outstanding debentures and the fair value of warrants as derivative liabilities. The total common stock and common stock equivalents outstanding as of December 31, 2017 are presented in Note 3. The total common stock and common stock equivalents outstanding as of April 1, 2018 are presented in Note 13.