Convertible Debentures (Tables)

12 Months Ended

Dec. 31, 2018

Debt Disclosure [Abstract]

Schedule of Convertible Debentures

Convertible debentures consist of the following at December 31, 2018:

Origination  Date	Maturity  Date	Interest  Rate			Origination  Principal  Balance		Original  Discount  Balance			Period End  Principal  Balance		Period End  Discount  Balance		Period End  Balance,  Net		Accrued  Interest  Balance		Reg.
8/31/2011	8/31/2013		5	%		10,000		(4,286	)		10,000		—		10,000		3,694		(2	)
12/01/17	12/01/19		6	%		50,000		(12,500	)		50,000		—		50,000		3,250		(4	)
12/05/17	12/04/19		6	%		50,000		(12,500	)		50,000		—		50,000		3,218		(5	)
										$	110,000	$	—	$	110,000	$	10,162

Convertible debentures consist of the following at December 31, 2017:

Origination  Date	Maturity  Date	Interest  Rate			Origination  Principal  Balance		Original  Discount  Balance			Period End  Principal  Balance		Period End  Discount  Balance			Period End  Balance,  Net		Accrued  Interest  Balance		Reg.
5/3/2011	5/5/2012		10	%		300,000		(206,832	)		300,000		—			300,000		200,000		(1	)
8/31/2011	8/31/2013		5	%		10,000		(4,286	)		10,000		—			10,000		3,191		(2	)
2/10/2012	2/10/2014		10	%		39,724		—			2,743		—			2,743		4,331		(3	)
12/01/17	12/01/18		6	%		50,000		(12,500	)		50,000		(11,470	)		38,530		250		(4	)
12/05/17	12/04/18		6	%		50,000		(12,500	)		50,000		(11,470	)		38,530		217		(5	)
										$	412,743	$	(22,940	)	$	389,803	$	207,989

(1)

On May 3, 2011, the Company borrowed $300,000 in exchange for a convertible debenture. The Debenture carried an interest rate of 10% interest per annum. The lender could at any time convert any portion of the debenture to common shares at a 30% discount of the “Market Price” of the stock based on the average of the previous ten (10) days weighted average closing prices on the date prior to the notice of conversion. The Company could prepay the debenture plus accrued interest at any time before maturity. In addition, as further inducement for loaning the Company the funds, the Company granted the lender 300,000 and 600,000 warrants at $337.50 and $472.50 per share, respectively. As a result, the Company allocated fair market value (“FMV”) to both the BCF and to the warrants, or $206,832, which was recorded as a discount against the debenture. The Company accreted the discount to interest expense. The Company recognized the FMV of the related warrants as $45,000 using the Black-Scholes valuation model.

On November 15, 2018, the Company entered into a Note Conversion Agreement pursuant to which the Noteholder converted $526,583 of principal and accrued interest due into 50,000,000 shares of the Company’s common stock in full satisfaction of this obligation. The Company recorded a loss on this conversion of this debt of $248,417 which was charged to interest expense.

(2)	The Company borrowed $10,000 in exchange for a convertible debenture. The lender at their option may convert all or part of the note plus accrued interest into common stock at a price of thirty percent (30%) discount as determined from the average four (4) highest closing bid prices over the preceding five (5) trading days. The Company valued the beneficial conversion feature of the convertible debenture at $4,286, which was accreted to interest expense over the period of the note.
(3)	The Company entered into three new debenture agreements upon sale/assignment of the original lenders. Because the stated terms of the new debenture agreement and principal amounts were significantly different from the original debenture, including analysis of value of the beneficial conversion feature at the assignment/purchase date, the transactions were treated as extinguishment of the old debentures and recorded as new for accounting purposes.
	The conversion price under the debentures was $0.37125 and the lender could convert at any time until the debenture plus accrued interest was paid in full. Various other fees and penalties applied if payments or conversions were not done timely by the Company. The lender was limited to maximum conversion of 4.99% of the outstanding Common Stock of the Company at any one time.
	On June 15, 2018, the Company entered into a Note Satisfaction, Settlement and General Release Agreement with the lender. Under the terms of the agreement, the lender released and discharged the Company from any further obligation due the lender with no further consideration. The Company recognized income of $2,743 in principal and $4,457 in related accrued interest.
(4)	The Company entered into a 6% Secured Convertible Promissory Note, due December 1, 2018, subject to extension. The Note is secured with such assets of the Company equal to the principal and accrued interest, and is guaranteed by the Company’s wholly-owned subsidiaries, Trebor Industries, Inc. and Brownie’s High Pressor Compressor Services, Inc. and the personal guarantee of Robert M. Carmichael, the Company’s Chief Executive Officer.
	The conversion price under the Note range from $0.02 per share if converted in the first year to $0.125 if converted in year five. The lender may convert at any time until the debenture plus accrued interest is paid in full. Various other fees and penalties apply if payments or conversions are not done timely by the Company. The lender will be limited to maximum conversion of 9.99% of the outstanding Common Stock of the Company at any one time. The Note was extended subsequent to year end for one additional year with a reduction in the conversion price to $0.01 per share.
(5)	The Company entered into a 6% Secured Convertible Promissory Note, due December 4, 2018, subject to extension. The Note is secured with such assets of the Company equal to the principal and accrued interest, and is guaranteed by the Company’s wholly-owned subsidiaries, Trebor Industries, Inc. and Brownie’s High Pressure Compressor Services, Inc. and the personal guarantee of Robert M. Carmichael, the Company’s Chief Executive Officer.
	The conversion price under the Note range from $0.02 per share if converted in the first year to $0.125 if converted in year five. The lender may convert at any time until the debenture plus accrued interest is paid in full. Various other fees and penalties apply if payments or conversions are not done timely by the Company. The lender will be limited to maximum conversion of 9.99% of the outstanding Common Stock of the Company at any one time. The Note was extended subsequent to year end for one additional year with a reduction in the conversion price to $0.01 per share.