| Schedule of Related Party Convertible Notes Payable |
Related party convertible notes
payable consisted of the following as of December 31:
| |
|
2019 |
|
|
2018 |
|
| |
|
|
|
|
|
|
| Convertible note 2019-02. On July 19, 2019, the Company issued a convertible note payable in the amount $815,217, with an original issue discount of $65,217 in exchange for $750,000. This note accrues interest at 8% per annum and matures on June 30, 2020. This note and accrued interest may convert into shares of common stock at the conversion price then in effect (initially $24 per share, subject to adjustment, which resulted in a beneficial conversion feature) 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 25% discount to the offering price. The conversion price is subject to adjustment upon the issuance of the Company’s common stock or securities convertible into common stock at a price per share less than the then prevailing conversion price, other than specified exempt issuances; accordingly, on November 8, 2019, the conversion price was adjusted to $14 per share, which resulted in a beneficial conversion feature. (The conversion price was further adjusted after December 31, 2019 in connection with subsequent issuances and was equal to $4.27 per share as of March 30, 2020.) This note was also issued with a detachable warrant to purchase 7,500 shares of stock at $24 per share, which shall be adjusted in accordance with any adjustment to the conversion price of this note; accordingly, on November 8, 2019, the exercise price was adjusted to $14 per share. (The exercise price was further adjusted after December 31, 2019 in connection with subsequent issuances and was equal to $4.27 per share as of March 30, 2020.) The valuation of the conversion feature and detachable warrants and intrinsic value of the beneficial conversion feature resulted in the recognition of an additional $582,533 discount on this note. This note requires monthly interest payments. |
|
$ |
815,217 |
|
|
$ |
- |
|
| |
|
|
|
|
|
|
|
|
| |
|
2019 |
|
|
2018 |
|
| |
|
|
|
|
|
|
| Convertible note 2019-07. On October 16, 2019, the Company issued a convertible note payable in the amount $217,391, with an original issue discount of $17,391 in exchange for $200,000. This note accrues interest at 8% per annum and matures on June 30, 2020. This note and accrued interest may convert into shares of common stock at the conversion price then in effect (initially $24 per share, subject to adjustment) 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 25% discount to the offering price. The conversion price is subject to adjustment upon the issuance of the Company’s common stock or securities convertible into common stock at a price per share less than the then prevailing conversion price, other than specified exempt issuances; accordingly, on November 8, 2019, the conversion price was adjusted to $14 per share, which resulted in a beneficial conversion feature. (The conversion price was further adjusted after December 31, 2019 in connection with subsequent issuances and was equal to $4.27 per share as of March 30, 2020.) This note was also issued with a detachable warrant to purchase 2,000 shares of stock at $24 per share, which shall be adjusted in accordance with any adjustment to the conversion price of this note; accordingly, on November 8, 2019, the exercise price was adjusted to $14 per share. (The exercise price was further adjusted after December 31, 2019 in connection with subsequent issuances and was equal to $4.27 per share as of March 30, 2020.) The valuation of the conversion feature and detachable warrants and intrinsic value of the beneficial conversion feature resulted in the recognition of an additional $110,783 discount on this note. This note requires monthly interest payments. |
|
|
217,391 |
|
|
|
- |
|
| |
|
|
|
|
|
|
|
|
| Officer convertible note. On November 15, 2019, the Company issued a convertible note payable in the amount $100,000. This note accrues interest at 14% per annum and matures on June 30, 2020. This note and accrued interest may convert into shares of common stock at the conversion price of $20 per share. This note requires monthly interest payments. |
|
|
100,000 |
|
|
|
- |
|
| |
|
|
|
|
|
|
|
|
| Total notes payable |
|
|
1,132,608 |
|
|
|
- |
|
| |
|
|
|
|
|
|
|
|
| Less original issue discounts |
|
|
(82,608 |
) |
|
|
- |
|
| |
|
|
|
|
|
|
|
|
| Related party convertible notes payable, net |
|
|
1,050,000 |
|
|
|
- |
|
| |
|
|
|
|
|
|
|
|
| Less conversion rights, warrant, and beneficial conversion feature discounts |
|
|
(693,316 |
) |
|
|
- |
|
| |
|
|
|
|
|
|
|
|
| Plus amortization of discounts |
|
|
295,037 |
|
|
|
- |
|
| |
|
|
|
|
|
|
|
|
| Total convertible notes payable, net |
|
$ |
651,721 |
|
|
$ |
- |
|
|