LONG-TERM NOTES PAYABLE
|3 Months Ended|
Mar. 31, 2020
|Debt Disclosure [Abstract]|
|LONG-TERM NOTES PAYABLE||
NOTE 8 – LONG-TERM NOTES PAYABLE
On February 15 and June 7, 2016, the Company entered into two 10 %, 18-month promissory notes for $100,000 each with an individual (the “Promissory Notes”). Pursuant to several amendments to the Promissory Notes through July 2019, (i) the Promissory Notes were extended to September 30, 2021 (the “Maturity Date”), (ii) accrued and unpaid interest on the Promissory Notes totaling $39,921 was transferred to principal, and (iii) interest will be accrued from August 2019 through the Maturity Date. The principal balance of the Promissory Notes at March 31, 2020 and December 31, 2019 was $239,921. Accrued interest at March 31, 2020 and December 31, 2019 was $15,995 and $9,997, respectively.
Convertible Promissory Notes
On September 14, 2017, the Company and an individual entered into a convertible promissory note with unilateral conversion preferences by the individual (the “Convertible Promissory Note”). On July 11, 2018, the Company’s board of directors, approved certain changes to the Convertible Promissory Note wherein the conversion feature was changed from unilateral to mutual between the individual and the Company.
At both March 31, 2020 and December 31, 2019, the total outstanding balance of the convertible promissory note (the “Note”) was $300,000. The maturity date of the Note is based on the payment of 0.6% of quarterly gross revenue until 1.5 times the amount of the Note is paid. Accrued interest at March 31, 2020 and December 31, 2019 was $33,759 and $31,243, respectively.
On September 27, 2019, the holder of the Note was granted a warrant to purchase 140,678 shares of common stock of the Company. The fair value of this warrant was recorded as financing costs on the accompanying condensed consolidated financial statements. See NOTE 9 for further details.
The entire disclosure for long-term debt.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef