|3 Months Ended|
Mar. 31, 2019
|Subsequent Events [Abstract]|
NOTE 12 – SUBSEQUENT EVENT
On April 8, 2019, the Company entered into a Securities Purchase Agreement ("SPA III") with the Investor for the purchase of a Convertible Promissory Note in the aggregate principal amount of $51,600 ("Note III") and received net proceeds of $40,000, net of original issue discount of $8,600 and net origination fees of $3,000. The Note bears interest at 4% per annum and is due and payable on April 8, 2020. The Note III may be converted by the Investor after six months from the date of Note III into shares of the Company's common stock at a price equal to 81% of the average of the lowest two closing bid prices of the common stock as reported on the OTC Link ATS owned by OTC Markets Group for the 10 prior trading days. The Company may prepay the Note at any time prior to its six-month anniversary, subject to pre-payment charges as detailed in the Note. The SPA and Note contain customary representations, warranties and covenants, including certain restrictions on the Company's ability to sell, lease or otherwise dispose of any significant portion of its assets. Investor also has the right of first refusal with respect to any future equity (or debt with an equity component) offerings of less than $100,000 conducted by the Company until the six-month anniversary of the Note. The SPA and the Note also provide for certain events of default, including, among other things, payment defaults, breaches of representations and warranties, proceedings, delinquency in periodic report filings with the SEC, and cross default with other agreements. In the event of default, at the option of the Investor and in the Investor's sole discretion, the Investor may consider the Note immediately due and payable. The Company has accounted for this convertible promissory note as stock settled debt under ASC 480 and recorded a debt premium of $12,104 with a charge to interest expense.
On April 23, 2019, the Company entered into a Subscription agreement with an investor whereby the investor agreed to purchase 2,000,000 shares of the Company's common for $300,000, or $0.15 per share (the "Subscription Amount"). To satisfy this subscription, the investor shall tender funds equal to $300,000 in six equal installments of $50,000, which commenced in February 2019. As of March 31, 2019, the Company had received cash of $100,000 towards the Subscription Amount (See Note 8). In April 2019, the Company received cash proceeds of $50,000 towards the Subscription Amount and believes they will receive the remaining proceeds of $150,000 on or prior to July 10, 2019. Upon receipt of the full Subscription Amount, the Company will issue 2,000,000 shares of its common stock to the investor.
On April 26, 2019, the Company entered into a Promissory Note ("Promissory Note") with an accredited investor in the aggregate principal amount of $25,000 and received net proceeds of $25,000. The Promissory Note bears interest at 4% per annum and is due and payable on April 26, 2020 (the "Maturity Date"). At the time the Promissory Note reaches its Maturity Date, the holder and the Company will discuss and mutually agree on potential conversion rights of the holder, including pricing, method of conversion, etc. At any time during which the Promissory Note is outstanding, the Company may prepay the Note in full, without penalty. The Promissory Note provides for certain events of default, including, among other things, payment defaults, bankruptcy, liquidation, and cessation of operations. In the event of default, the holder shall be entitled to an injunction or injunctions restraining, preventing or curing any breach of this Promissory Note and to enforce specifically the terms and provisions thereof, without the necessity of showing economic loss and without any bond or other security being required.
The entire disclosure for significant events or transactions that occurred after the balance sheet date through the date the financial statements were issued or the date the financial statements were available to be issued. Examples include: the sale of a capital stock issue, purchase of a business, settlement of litigation, catastrophic loss, significant foreign exchange rate changes, loans to insiders or affiliates, and transactions not in the ordinary course of business.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef