Annual report pursuant to Section 13 and 15(d)

Subsequent Events

Subsequent Events

12 Months Ended

Dec. 31, 2019

NOTE 18 – SUBSEQUENT EVENTS

The Company evaluated all material events through the date the financials were ready for issuance and noted the following non-recognized events for disclosure.

Potential Impact of COVID-19

In December 2019, a novel coronavirus was reported in China and the resulting COVID-19 has become a global pandemic as of the date of this report. This matter may negatively impact our results of operations; however, the related financial impact and duration cannot be reasonably estimated at this time.

Convertible Promissory Notes

The Company entered into convertible notes payable with lenders as set forth in the table below. Each of these notes and accrued interest thereon may convert into shares of our common stock at the conversion price set forth in the table below. Certain of these notes were issued with detachable five-year warrants to purchase shares of our common stock as set forth in the table below.

Issuance Date	Principal Amount		Original Issue Discount		Gross Proceeds		Interest Rate			Maturity Date			Note Conversion Price Per Share			Number of Shares Underlying Warrants			Warrant Exercise Price Per Share
January 6, 2020	$	10,870	$	870	$	10,000		8%	⁽¹⁾		June 30, 2020	^(4,5)	$	10.00	⁽⁷⁾		100		$	10.00
January 21, 2020		262,500		12,500		250,000		10%	^(2,3)		June 30, 2020	⁽⁶⁾		4.27	⁽⁷⁾		-	^(10,11)		-
February 25, 2020		52,632		2,632		50,000		8%	⁽¹⁾		June 30, 2020	^(4,5)		7.50	⁽⁸⁾		500			7.50
March 16, 2020		250,000		20,000		230,000		10%	⁽²⁾		September 16, 2020	⁽⁴⁾		4.50	^(7,9)		-	^(10,12)		5.75
March 16, 2020		250,000		20,000		230,000		10%	⁽²⁾		September 16, 2020	⁽⁴⁾		4.50	^(7,9)		-	^(10,12)		5.75
Total	$	826,002	$	56,002	$	770,000		8-10%			2020		$	4.27-10.00			600		$	5.75-10.00

	⁽¹⁾	Accrued interest on this note is payable monthly in cash.
	⁽²⁾	Accrued interest on this note is payable upon maturity.
	⁽³⁾	One-time fixed interest charge equal to ten percent (10%).
	⁽⁴⁾	Prepayment of this note is not subject to a prepayment penalty or premium.
	⁽⁵⁾	If this note, or any portion thereof, has not been repaid or converted in full on or prior to the maturity date, then repayment of the unpaid principal balance plus any accrued and unpaid interest thereon, shall be amortized over the following thirty-six (36) months.
	⁽⁶⁾	Prepayment of this note is subject to a prepayment penalty or premium of fifteen percent (15%) for prepayments on or prior to March 31, 2020, twenty-five percent (25%) for prepayments on or prior to May 15, 2020, or thirty percent (30%) prior to June 30, 2020
	⁽⁷⁾	This note and accrued interest thereon may convert into shares of our common stock any time at the holder’s option.
	⁽⁸⁾	This note and accrued interest thereon may convert into shares of our common stock any time at the holder’s option or automatically upon a qualified financing of at least $5 million at the lower of the conversion price then in effect or a twenty-five percent (25%) discount to the offering price.
	⁽⁹⁾	The conversion price of this note is subject to adjustment upon the issuance of our common stock or securities convertible into our common stock at a price per share less than the then prevailing conversion price, other than specified exempt issuances.
	⁽¹⁰⁾	No warrant was issued in connection with this note.
	⁽¹¹⁾	5,855 shares of our common stock were issued in connection with the purchase of this note.
	⁽¹²⁾	5,000 shares of our common stock were issued as a commitment fee in connection with the purchase of this note. In addition, 27,777 shares of our common stock were issued in connection with the purchase of this note; provided, however, such shares must be returned to us if this note is fully repaid within six (6) months following the issuance date.

On January 16, 2020, the $150,000 convertible note issued April 18, 2019 was amended as follows: (i) the maturity date was extended, as of December 31, 2019, to March 31, 2020; (ii) we agreed to make payments of accrued interest and principal, together with a prepayment penalty equal to twenty percent (20%) of the principal payment, in an aggregate amount of not less than $15,000 per month beginning February 1, 2020 until this note was repaid in full; and (iii) the lender agreed that we could incur additional indebtedness. On March 17, 2020, we fully repaid the remaining principal and interest due under this note, together with a reduced prepayment penalty equal to approximately ten percent (10%) of the principal payment, for an aggregate payment amount of $150,000, pursuant to an agreement between the holder and us, under which we also agreed to adjust the exercise price of the warrant issued in connection with this note to $6.25 per share.