Quarterly report pursuant to Section 13 or 15(d)

NOTE 5: DEBT

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NOTE 5: DEBT
3 Months Ended
Mar. 31, 2019
Debt Disclosure [Abstract]  
Debt Disclosure [Text Block]

NOTE 5: DEBT


Notes Payable


During October 2018, the Company borrowed $345,000, net of original debt discount of $45,000 under a note payable. The note payable bears interest at 7% per annum, was due January 18, 2019 and is unsecured. The notes was extended until April 19, 2019 in exchange for a $55,000 debt extension fee added to the principal of the note. As of March 31, 2019 and December 31, 2018, the balance on the note payable was $400,000 and $345,000, respectively. During the three months ended March 31, 2019, the Company recognized the remaining $8,804 in amortization of the debt discount.


As of March 31, 2019 and December 31, 2018, the Company had outstanding notes payable to former affiliates of the Company of $413,185 and $413,185, respectively. The notes payable are unsecured, bear no interest and are due on demand.


Convertible Debt


During August 2018, the Company issued a convertible note payable in the amount of $160,000. The convertible note payable is due one year from the date of issuance, has an original issuance discount of $10,000, accrues interest at the rate of 10% per annum, is unsecured and is convertible after 180 days into shares of the Company’s common stock at a discount of 65% of the lowest trading price for the Company’s common stock during the twenty trading days immediately preceding the conversion.


During the three months ended March 31, 2019, the entire balance of the note was repaid and the Company recognized the remaining $6,356 in debt discount amortization expense.


During February 2019, the Company issued a convertible note payable in the amount of $315,000. The convertible note payable is due one year from the date of issuance, has an original issuance discount of $15,000, accrues interest at the rate of 6% per annum, is unsecured and is convertible after 180 days into shares of the Company’s common stock at a discount of 65% of the lowest trading price for the Company’s common stock during the ten trading days immediately preceding the conversion.


During the three months ended March 31, 2019, the Company recognized $1,356 in debt discount amortization expense related to the issuance of the convertible note payable.